By Nermeen Nabil TLDR
IOTA Foundation’s Web3 Identification Solution, developed with partners, has been selected for the European Blockchain Sandbox.
The solution tokenizes identification processes, allowing users to verify identity in Web3 while maintaining control over personal data.
Users undergo remote identification with IDnow, which is tokenized by walt.id and stored in the Bloom wallet as a soulbound token.
The token can be recognized by Web3 dApps and services to confirm user identity without revealing personal information.
HAVN Network provides the dedicated EVM-compatible KYC chain infrastructure anchored to the Shimmer network.
The IOTA Foundation, in collaboration with walt.id, IDnow, Bloom Wallet, and HAVN, has developed a groundbreaking Web3 Identification Solution that has been selected for the European Blockchain Sandbox.
This initiative, launched by the European Commission in 2023, provides a controlled environment for testing and validating innovative distributed ledger technology (DLT) solutions while engaging with regulators from across the EU.
The Web3 Identification Solution aims to revolutionize traditional Know-Your-Customer (KYC) processes, which have long been hindered by inefficiencies, high costs, and data privacy concerns.
By leveraging DLT and tokenization, the solution enables users to maintain control over their personal data while providing a seamless and privacy-preserving way to identify themselves in Web3 environments.
The identification process begins with users undergoing a remote identification with IDnow, a leading identity verification platform provider in Europe.
This process complies with EU Anti-Money Laundering (AML) and KYC requirements. The identification is then tokenized by walt.id, a prominent provider of open-source decentralized identity and wallet infrastructure, and stored in the user’s Bloom wallet as a soulbound token.
The soulbound token can be recognized by Web3 dApps and other services to confirm the user’s identity without revealing personal information.
This reusable token eliminates the need for repetitive identification processes, enhancing user experience and privacy.
If requested by an authorized party, the identity information can be revealed, and the token can also be revoked.
The identity information can be issued in the W3C Verifiable Credential format for permissionless sharing in off-chain use cases.
HAVN Network, a specialist in integrating hybrid blockchain technologies, provides the dedicated EVM-compatible KYC chain infrastructure anchored to the Shimmer network. This enables efficient interchain communication and transaction validation while ensuring regulatory compliance.
Being selected for the European Blockchain Sandbox is a significant milestone for the Web3 Identification Solution, as it opens the door to regulatory discussions about KYC and privacy in a Web3 environment. This is particularly relevant given the increasing interest of regulators in decentralized finance (DeFi).
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Nermeen Nabil Khear