Close Menu
  • News
    • Bitcoin
    • Altcoins
    • DeFi
    • Regulation
    • Market Cap
    • Web 3
    • Scam
  • Blockchain
  • NFT
  • Metaverse
  • Analysis
  • Learn
  • Blog
  • Contact
    • Tech7685@gmail.com
What's Hot

Low Cap Nasdaq-Gentered Company reveals $ 300,000,000 fundraising plan to acquire crypto, including the Trump token of the president: report

2025-05-14

$ 1.2 billion in Ethereum withdrawn from CEXS – Strong Accumulation Signal

2025-05-14

SEC chairman Paul Atkins says that a rational regulatory framework that needs us to become ‘crypto capital of the planet’.

2025-05-14
Facebook X (Twitter) Instagram
  • Contact
  • Terms & Conditions
  • Privacy Policy
  • DMCA
  • Advertise
  • BitcoinPlatform.com
Facebook X (Twitter) Instagram
Free Cryptocurrency – Bitcoin | Altcoins | Blockchain | News Stories Updated Daily
  • News
    • Bitcoin
    • Altcoins
    • DeFi
    • Regulation
    • Market Cap
    • Web 3
    • Scam
  • Blockchain

    Co-founder of Solana Anatoly proposes a Metablokchain concept

    2025-05-14

    Layer-2 Blockchain explosion ends safe integration on the risks of third parties risks

    2025-05-14

    Codexfield bundles forces with LoveBit to stimulate ESG Innovation in Web3 & Crypto

    2025-05-14

    SFT protocol joins Glacier Labs to bridge physical and data infrastructure

    2025-05-14

    Dantewada secures more than 700,000 land records on avalanche blockchain

    2025-05-14
  • NFT

    AI Sports Betting Agent wants to disrupt the Tipster industry using Crypto

    2025-05-14

    Bidding starts at Ross Ulbricht’s pre-judgment and prison thinking of the fact that he is starting a new chapter

    2025-05-14

    Why this Facebook group places the news on NFTS

    2025-05-13

    Mey Network launches real estate NFTs to invest real estate in the chain

    2025-05-13

    Animoca Brands plans our mention to record ‘unique moment’ of Trump administration: FT

    2025-05-13
  • Metaverse

    Shib: The Metaverse – Part of the expanding Shiba Inu ecosystem

    2025-01-03

    Experience to Earn: Everdome’s Metaverse Frontier

    2024-12-30

    Beyond Bots: Meta Motivo and the Dawn of Human Digital Life

    2024-12-13

    Exploring NetVRk: What’s Behind This AI-Powered Virtual Universe?

    2024-10-28

    Council of Europe emphasizes the impact of Metaverse on privacy and democracy

    2024-09-05
  • Analysis

    Low Cap Nasdaq-Gentered Company reveals $ 300,000,000 fundraising plan to acquire crypto, including the Trump token of the president: report

    2025-05-14

    Why $ 2.69 contains the key

    2025-05-14

    According to analyst Jason Pizzino, it will be time to be careful to carefully turn to cryptomarkets

    2025-05-14

    Dogecoin (Doge) is higher for the next leg – will the resistance plan break?

    2025-05-14

    21Shares says that Solana is on Tempo Linchpin of digital finances

    2025-05-14
  • Learn

    What Is Proof-of-Work (PoW)?

    2025-05-12

    What Is Proof-of-Authority (PoA)?

    2025-05-10

    What Is Proof-of-Stake (PoS)? A Beginner’s Guide

    2025-05-09

    What Is a Layer-1 (L1) Blockchain?

    2025-05-03

    What is a Layer-2 (L2) Blockchain Network Solution?

    2025-05-02
  • Blog
  • Contact
    • Tech7685@gmail.com
Free Cryptocurrency – Bitcoin | Altcoins | Blockchain | News Stories Updated Daily
Home»Regulation»Not all blockchains have to be pseudonymous
Op-ed: Not all blockchains need to be pseudonymous
Regulation

Not all blockchains have to be pseudonymous

2024-02-11No Comments4 Mins Read
Share
Facebook Twitter LinkedIn Pinterest Email

Blockchain technology has the potential to improve several industries, especially in the financial sector. Layer one protocols, which are essentially the foundation layer of any blockchain network, serve as key components of a blockchain system. Examples of layer one blockchains are Bitcoin, Ethereum and Binance Smart Chain. These blockchains serve as the base layer for various decentralized applications (DApps) and smart contracts.

Layer one protocols are responsible for establishing the fundamental rules and consensus mechanisms that govern a blockchain network. They determine how transactions are validated and added to the general ledger. Furthermore, layer one protocols are where interoperability between different dApps will happen in the future.

Companies can also deploy their own layer one, known as an ‘enterprise blockchain’, to achieve their company’s goals or provide services. These blockchains are fundamentally different from the aforementioned layer blockchains, which focus on providing services while aligning with the core principles of crypto, including pseudonymity, decentralization, and more.

An enterprise blockchain can move beyond principles to deliver services in a compliant manner. They can therefore offer services that are otherwise not feasible due to regulations in a pseudonymous environment and perhaps bring a new kind of user to layer one technology.

KYC and AML for regulatory compliance

In today’s digital landscape, where financial transactions are taking place at an unprecedented pace, regulatory compliance is key. Everyone in the financial sector is familiar with the Know Your Customer (KYC) and Anti-Money Laundering (AML) protocols. Businesses verify the identity of their customers, limiting the risk of fraudulent activity.

KYC and AML are regulatory compliance processes designed to prevent and detect illegal activities such as money laundering and terrorist financing. These processes are especially important in the financial sector, including for cryptocurrency exchanges and platforms that handle virtual assets. Such regulations ensure that companies actively monitor transactions, identify suspicious patterns or behavior and report potential risks to the relevant authorities.

See also  The US Supreme Court rules against Coinbase in a dispute over the Dogecoin sweepstakes

The decentralized nature of layer one blockchains poses challenges for their direct implementation at the protocol level. Some DeFi platforms and services built on top of layer one blockchains have implemented their own user identification and compliance mechanisms.

For example, some projects explore the use of tokens or smart contracts specifically designed to facilitate compliance with regulatory requirements. These tokens can represent a user’s verified identity on the blockchain without revealing sensitive information.

However, the more distributed nature of enterprise blockchains makes the prospects for implementing AML and KYC at the base layer a more practical endeavor. This gives ordinary people and institutions the confidence to interact directly with a business blockchain of their choice.

Financial transparency via KYC and AML

Financial transparency is critical to building trust and integrity of financial systems, including blockchain-based systems. The integration of KYC and AML protocols on a blockchain layer-one protocol offers enormous potential to provide users with transparency while maintaining confidentiality through technology such as zero-knowledge proofs, a method that allows one party to the other party proves that a particular statement is true without revealing information beyond the truth of the statement. AML procedures on a layer one blockchain ensure that transactions can be audited in real time.

While regulatory compliance is critical for widespread adoption and integration with traditional financial systems, the balance between privacy, decentralization and compliance is challenging. Cryptocurrency regulatory developments are dynamic and jurisdictions may approach these issues in different ways.

As the industry evolves, it is likely that there will be continued developments in how KYC and AML measures can be effectively implemented within the decentralized and pseudonymous nature of layer one blockchains.

See also  How blockchains can make AI more secure

The possibility at layer one

The fact is that layer one protocols have the potential to provide seamless integration with external data sources, enabling real-time verification of customer identities and monitoring of transactional activities. Original blockchains such as Bitcoin, Ethereum and many others are based on fundamental blockchain principles that effectively prohibit AML and KYC procedures. New enterprise blockchains don’t necessarily have to adopt these principles and so can be built with a different demographic in mind.

Such layer one protocols can include features such as identity verification mechanisms, transaction monitoring tools, and smart contract functionalities to enable secure and transparent on-chain transactions.

Organizations can then use layer one blockchains to establish trust among participants by ensuring all users comply with KYC and AML regulations in a tamper-proof environment designed to securely store sensitive customer information.

A new crop of layer one blockchains, which have implemented AML and KYC functionalities, could create the incentives needed to attract new users who could benefit from layer one blockchain technology.

Source link

blockchains pseudonymous
Share. Facebook Twitter Pinterest LinkedIn Tumblr Email

Related Posts

SEC chairman Paul Atkins says that a rational regulatory framework that needs us to become ‘crypto capital of the planet’.

2025-05-14

American legislators warn Treasury about taxing the non -realized crypto wins of American companies

2025-05-13

Fed Council Warns Stablecoins can pose a risk of bank deposits and credit capacity

2025-05-13

US Banking Authority knew the path for crypto services at National Banks

2025-05-13
Add A Comment

Comments are closed.

Top Posts

Kendall Jenner, J Balvin to Judge NFT Competition for AIDS Charity

2023-06-26

The latest beef in Web3

2024-05-30

MicroStrategy Loses $30 Billion in Four Days: Is the Bitcoin Bet Risky?

2024-11-28
Editors Picks

Crypto Analyst Predicts Short Squeeze for Binance Coin (BNB) – But There’s a Big Catch

2023-07-09

The ‘fair value’ of Bitcoin – Why does the ECB have a problem with it?

2024-02-23

ZK Proofs: Web3’s Automated Bullsh*t Detector.

2023-09-21

TON Foundation partners with Chainalysis for Blockchain security

2023-05-03
About
About

Our mission is to develop a community of people who try to make financially sound decisions. The website strives to educate individuals in making wise choices about Cryptocurrencies, Defi, NFT, Metaverse and more.

We're social. Connect with us:

Facebook X (Twitter) Instagram Pinterest YouTube
Top Insights

Low Cap Nasdaq-Gentered Company reveals $ 300,000,000 fundraising plan to acquire crypto, including the Trump token of the president: report

$ 1.2 billion in Ethereum withdrawn from CEXS – Strong Accumulation Signal

SEC chairman Paul Atkins says that a rational regulatory framework that needs us to become ‘crypto capital of the planet’.

Get Informed

Subscribe to Updates

Get the latest news and Update from Free.cc about Crypto, Metaverse, NFT and more.

  • Contact
  • Terms & Conditions
  • Privacy Policy
  • DMCA
  • Advertise
  • BitcoinPlatform.com
© 2025 Free.cc - All rights reserved. Contact: info@free.cc

Type above and press Enter to search. Press Esc to cancel.

  • bitcoinBitcoin(BTC)$103,350.46-1.50%
  • ethereumEthereum(ETH)$2,606.38-3.19%
  • tetherTether USDt(USDT)$1.00-0.03%
  • rippleXRP(XRP)$2.57-0.62%
  • solanaSolana(SOL)$177.25-2.75%
  • binancecoinBNB(BNB)$652.77-2.12%
  • usd-coinUSDC(USDC)$1.00-0.03%
  • dogecoinDogecoin(DOGE)$0.234540-1.87%
  • cardanoCardano(ADA)$0.80-4.06%
  • tronTRON(TRX)$0.2764451.66%
  • suiSui(SUI)$3.93-3.05%
  • chainlinkChainlink(LINK)$17.03-3.42%
  • avalanche-2Avalanche(AVAX)$25.27-2.22%
  • stellarStellar(XLM)$0.305009-3.33%
  • shiba-inuShiba Inu(SHIB)$0.000016-3.60%
  • hedera-hashgraphHedera(HBAR)$0.207577-4.39%
  • hyperliquidHyperliquid(HYPE)$25.10-4.46%
  • the-open-networkToncoin(TON)$3.27-4.08%
  • unus-sed-leoUNUS SED LEO(LEO)$8.821.03%
  • bitcoin-cashBitcoin Cash(BCH)$404.05-2.43%
  • polkadotPolkadot(DOT)$5.02-3.76%
  • litecoinLitecoin(LTC)$100.23-3.69%
  • piPi(PI)$0.92-22.89%
  • moneroMonero(XMR)$341.800.07%
  • pepePepe(PEPE)$0.000014-5.76%
  • bitget-tokenBitget Token(BGB)$4.73-1.67%
  • daiDai(DAI)$1.00-0.04%
  • ethena-usdeEthena USDe(USDE)$1.00-0.05%
  • uniswapUniswap(UNI)$6.60-8.29%
  • bittensorBittensor(TAO)$454.50-2.07%
  • nearNEAR Protocol(NEAR)$3.07-5.65%
  • aptosAptos(APT)$5.79-6.40%
  • aaveAave(AAVE)$229.21-2.63%
  • ondo-financeOndo(ONDO)$1.03-2.46%
  • okbOKB(OKB)$54.07-0.19%
  • kaspaKaspa(KAS)$0.120500-4.21%
  • internet-computerInternet Computer(ICP)$5.68-3.36%
  • ethereum-classicEthereum Classic(ETC)$19.86-4.20%
  • crypto-com-chainCronos(CRO)$0.102440-0.37%
  • gatechain-tokenGateToken(GT)$21.81-0.20%
  • official-trumpOFFICIAL TRUMP(TRUMP)$13.38-1.81%
  • render-tokenRender(RENDER)$5.15-3.93%
  • mantleMantle(MNT)$0.79-4.12%
  • vechainVeChain(VET)$0.030600-5.29%
  • polygon-ecosystem-tokenPOL (prev. MATIC)(POL)$0.252030-3.64%
  • ethenaEthena(ENA)$0.407820-8.09%
  • usd1World Liberty Financial USD(USD1)$1.00-0.12%
  • algorandAlgorand(ALGO)$0.240332-3.33%
  • filecoinFilecoin(FIL)$3.07-4.60%
  • arbitrumArbitrum(ARB)$0.429274-5.77%
  • bitcoinBitcoin(BTC)$103,350.46-1.50%
  • ethereumEthereum(ETH)$2,606.38-3.19%
  • tetherTether USDt(USDT)$1.00-0.03%
  • rippleXRP(XRP)$2.57-0.62%
  • solanaSolana(SOL)$177.25-2.75%
  • binancecoinBNB(BNB)$652.77-2.12%
  • usd-coinUSDC(USDC)$1.00-0.03%
  • dogecoinDogecoin(DOGE)$0.234540-1.87%
  • cardanoCardano(ADA)$0.80-4.06%
  • tronTRON(TRX)$0.2764451.66%
  • suiSui(SUI)$3.93-3.05%
  • chainlinkChainlink(LINK)$17.03-3.42%
  • avalanche-2Avalanche(AVAX)$25.27-2.22%
  • stellarStellar(XLM)$0.305009-3.33%
  • shiba-inuShiba Inu(SHIB)$0.000016-3.60%
  • hedera-hashgraphHedera(HBAR)$0.207577-4.39%
  • hyperliquidHyperliquid(HYPE)$25.10-4.46%
  • the-open-networkToncoin(TON)$3.27-4.08%
  • unus-sed-leoUNUS SED LEO(LEO)$8.821.03%
  • bitcoin-cashBitcoin Cash(BCH)$404.05-2.43%
  • polkadotPolkadot(DOT)$5.02-3.76%
  • litecoinLitecoin(LTC)$100.23-3.69%
  • piPi(PI)$0.92-22.89%
  • moneroMonero(XMR)$341.800.07%
  • pepePepe(PEPE)$0.000014-5.76%
  • bitget-tokenBitget Token(BGB)$4.73-1.67%
  • daiDai(DAI)$1.00-0.04%
  • ethena-usdeEthena USDe(USDE)$1.00-0.05%
  • uniswapUniswap(UNI)$6.60-8.29%
  • bittensorBittensor(TAO)$454.50-2.07%
  • nearNEAR Protocol(NEAR)$3.07-5.65%
  • aptosAptos(APT)$5.79-6.40%
  • aaveAave(AAVE)$229.21-2.63%
  • ondo-financeOndo(ONDO)$1.03-2.46%
  • okbOKB(OKB)$54.07-0.19%
  • kaspaKaspa(KAS)$0.120500-4.21%
  • internet-computerInternet Computer(ICP)$5.68-3.36%
  • ethereum-classicEthereum Classic(ETC)$19.86-4.20%
  • crypto-com-chainCronos(CRO)$0.102440-0.37%
  • gatechain-tokenGateToken(GT)$21.81-0.20%
  • official-trumpOFFICIAL TRUMP(TRUMP)$13.38-1.81%
  • render-tokenRender(RENDER)$5.15-3.93%
  • mantleMantle(MNT)$0.79-4.12%
  • vechainVeChain(VET)$0.030600-5.29%
  • polygon-ecosystem-tokenPOL (prev. MATIC)(POL)$0.252030-3.64%
  • ethenaEthena(ENA)$0.407820-8.09%
  • usd1World Liberty Financial USD(USD1)$1.00-0.12%
  • algorandAlgorand(ALGO)$0.240332-3.33%
  • filecoinFilecoin(FIL)$3.07-4.60%
  • arbitrumArbitrum(ARB)$0.429274-5.77%