What is an MRZ Code? The Role of MRZ Technology in Identity Verification
Today, all nations have adopted MRZ code ID document formats as part o...
Over the last 9 years, cryptocurrency has grown tremendously. Bitcoin used to be the only coin on the market, but today it shares the crypto market with 1800 other cryptocurrencies. Cryptocurrency exchanges are on the rise as well, with 500 currently in existence.
Despite this growth, there has not been a worldwide adoption of cryptocurrency. Consumers have demonstrated that while cryptocurrency is a great idea in theory, they do not automatically trust it.
It goes back to the old saying, “Trust is earned, not gained.” Consumers want their investments and the personally identifiable information (PII) they share within a currency system to remain safe and secure. These objectives must be met to build trust for cryptocurrency among users and regulating entities. Without meeting these objectives, worldwide adoption of a cryptocurrency system will continue to be scrutinized.
More and more regulation will be enforced by global governments into this new age of cryptocurrency. Therefore, time is a limiting factor. Soon enough the norm will be for most exchanges to require identity verification for their customers. There are many reasons for this such as preventing money laundering and fraud. The most trusted exchanges follow identity verification process protocols for these reasons.
Cryptocurrency exchanges and wallets want to experience the same trust as traditional financial services, but for this to happen exchanges must find a solution to identity verification. The problem is the traditional tedious process of identity verification.
In the past, cryptocurrency exchanges have been compared to the wild west because of the disorder, theft and a shortage of lawmen to keep the peace abound. Running a trusted organization in this kind of environment can be a challenge. Being regulated, following compliance standards and establishing legitimacy are keys for exchanges and cryptocurrencies to become mainstream industries.
IDMERIT believes that identity verification plus compliance equals legitimate users and brand trust. These factors can help cryptocurrency exchanges develop a standard of excellence and build authority in a skeptical world.
By utilizing the most current best practices for identity verification, your customers can trust that you are protecting their interests and their investments.
The loss that exchanges may suffer from fraud and stolen coins runs into billions of dollars in equivalent coins each year. Incurred loss from fraud and theft falls ultimately on the shoulders of your customers. By sealing off the loopholes for fraud through a suitable identity verification solution, you effectively prevent losses that would otherwise force you to increase the prices of your goods or services. The ultimate beneficiary of these security measures being the customer.
Onboarding legitimate and verified users can prevent Identity theft. Implementing an identity solution into your exchange is one of the most effective ways to ensure that your customers will not suffer this kind of fate, safeguarding the keeping them from unnecessary frustration.
There are many efforts being made to tame the wild west environment of cryptocurrency. Exchanges are targets for scandal and mistrust due to criminals potentially using exchanges to carry out illegal activities. An exchange that has been scandalized by theft and fraud cases will bear the risk of customer loss. An identity verification solution can prevent such indignities and help your exchange preserve its reputation.
Regulatory obligations are growing. Cryptocurrency exchanges need to be sure they are complying with ever-growing rules and regulations. Failure to do so may amount to lawsuits and costly fines. IDMERIT’s identity verification solutions will make regulatory compliance with identity verification frictionless and effortless, so your business will not run the risk of capturing misleading personal customer information. Consequently, it becomes easy for your business to remain compliant and mitigate risk with such legal requirements. Ultimately our solutions will help your exchange retain customer confidence and protect your business from fraud.
Regulators believe that they should introduce Know Your Customer (KYC) and Anti-Money Laundering (AML) regulations to cryptocurrencies. They are under the impression that these regulations will help prevent criminals worldwide from performing nefarious activities like money laundering or terrorist financing.
Some cryptocurrency advocates claim that regulation in the form of KYC and AML go against the fundamental philosophies of blockchain. These advocates think that cryptocurrencies should remain anonymous and untraceable. Regulators find this argument exhausting because it makes it more difficult for them to prevent and monitor for crime within the crypto space.
Regulation for crypto exchanges would not go against the fundamental nature of the currency. In fact, crypto regulation would benefit exchanges and users in a variety of different ways.
It would increase the flow of institutional capital into crypto markets. It would also strengthen corporate governance in crypto companies. Crypto exchanges would be legitimate entities and be subject to the same rights and benefits as other legal institutions. In theory, crypto consumers should feel more secure knowing their interests are protected by regulators.
Plus, crypto consumers would experience more transaction freedom if regulations were put into place. Currently, many exchanges put limits on the amount of crypto that can be transferred to fiat money in unverified customer accounts. If all crypto exchanges were regulated, these types of hinderances to consumers would not exist.
Customer onboarding begins with the sign-up process but if this process is tedious and time consuming you will lose that customers interest thus causing increases in customer abandonment. The bottom line is lost revenue.
The effort required to sign up > Perceived value to customer = Onboard abandonment
Reduce effort required to sign up. Increase perceived value.
In these cases, we can verify your customers with 70-99% using one or more of these additional data points.
We have structured our verification solution to follow a step by step information collection of PII, so you minimize the friction and make onboarding an effortless easy process for your customers. With our solution most of your customers will only need to provide one or two pieces of PII for successful identity verification.
IDMERIT offers a comprehensive ecosystem of global identity verification solutions. These solutions can help you establish the best practices of KYC, AML, fraud prevention and due diligence. You can approve buy/sell limits and keep currency moving by quickly by accurately identifying legitimate customers and keeping out criminals. This way you can satisfy regulatory demands while maintaining a frictionless user experience for your customers.