Zero Knowledge Proofs & AML / KYC is fundamentally going to have to change in the new crypto world
Let’s speak to the liberty minded and conscious among us. Taxes, KYC (Know Your Customer) & AML (Anti-Money Laundering) is absolutely a form of control that governments put on people, via the businesses they interact with, because governments want as much control over your lives as possible.
Governments in the Western World arent evil, manically entities (usually), they are just an natural evolution of what happens when governments get power and money, they always want more power and more money. It’s a snowball starting at the top of a very big mountain and it just happens as its rolling to collect instead of more snow, more of your money and information.
It’s always the same, who do you interact with, where do you earn your money, how do you spend your money money, who do you give money to etc...
They wrap it up under a blanket of "anti-terrorism", "preventing crime", “think of the children” mantra’s, but really it's a thinly veiled attempt so they can collect as much taxes as possible and (if you believe some not so crazy conspiracies) be able to control people.
Crime, terrorists and bad actors have existed long before this new revolution in data and finance we see with blockchain, we however need to be careful in our attempts to thwart criminals we don’t take all the locks off the doors at the safe in the name of “protection” and end up with the completely opposite intended result.
There is a great video by Computerphile on Zero Knowledge Transactions, which I believe is the going to be the center of the debate in blockchain and privacy.
https://www.youtube.com/watch?v=HUs1bH85X9I
Let’s be clear, taxes are absolutely needed to run a country and even the most small government, fiscally conservative would have severe difficulty showing how a country can run itself and provide for its citizens without a collective “fund” to build infrastructure and provide basic services (police, fire, ems, garbage, water, sewer etc).
For example, using Zero Proof transactions I can easily imagine you go to purchase a car at your local dealership, the latest hotrod or truck for work. In a Zero Proof transaction, you can buy the car, insurance, gas, pay the taxes, schedule and pre-pay maintenance etc all entirely remotely and electronically, without the car dealership ever having to know anything about you other then they got paid.
Now whether or not you agree or believe in any of that above debate, it’s becoming irrelevant to an extent. Cryptocurrency is quickly becoming completely and absolutely fully encrypted exchange of information (money in this case). We have a very near future where 2 people can exchange value and have absolutely no information about the other person due to mathematically settling a hash algorithm that lives only for a brief time and once solved allows for zero trust transfers. It won't matter who they are, where they live, how much money they have etc.
Now people who are worried about cryptocurrency say this is a bad thing, we need to know who these people are!… but in fact it's the absolute best scenario for digital transactions, because the more that is exposure the more risk there is for both parties. When you buy something from Amazon using your credit card, you transfer on the open internet (hopefully encrypted) your credit card number, home address, your buying habits, what your children and spouse regularly purchase, what medications they might be on, a disability you’re not comfortable sharing etc
The same technology that allows that transactions (online banking, using Amazon or Ebay, even sending emails) to occur but not have hackers steal your money is, on a whole different level, what is coming via cryptocurrency, to the point that you can (and may required to be) fully anonymous during the transaction. This not only provides a tremendous level of security and hence privacy, it also means that governments will need to adapt.
Governments can (and will) still collect taxes but it will likely be in consumption. Buy a coffee, pay more tax, because paying payroll, income, capital gains taxes will be harder to equate for governments. You can collect KYC & verify AML, but tying that to a specific "bank account" in a cryptocurrency future will never work. Sadly like all laws, only the law abiding will try to comply with them.
Horizon Communications works tirelessly to comply with KYC and AML requirements both in Bermuda and with Governments around the world. We want to and will be the gold standard of companies operating in the ICO, Cryptocurrency and Telecommunications space. Our mission is to be the apex of Telecommunications Providers and in doing so we have a responsibility to the countries we operate in and to our customers to be responsible corporate citizens.
As these regulations keep increasing in size and in scope, all in an attempt to grab hidden ghosts or collect taxes through it’s the companies like us they are left holding the bag, trying to make sense and satisfy requirements that through technology like cryptocurrency and blockchain will become harder and harder to meet.
Bermuda is one country that “gets it” and is always striving to balance being a great place to do business and also, as Horizon should, meet the requirements of a company operating from its shores doing business globally. It should also be noted that in the USA, who is constantly looked at for guidance in cryptocurrency and blockchain regulatory concerns, there is a growing chorus of people both in the private and public sector to not overburden companies in the blockchain space with regulations that, even if wanted to, cannot survive in a future with full encryption capabilities.
This article reflects the personal opinions of Gilbert A. Darrell.
Gilbert A Darrell is the Founder of Horizon. He has 18 years experience in information technology and telecom solutions, a veteran in Fire and EMS Services, a crypto enthusiast and a member of the Bermuda Government’s Cryptocurrency Task Force.
Horizon Communications is an upcoming fixed wireless internet and cellular service provider looking to provide services in Bermuda, the Caribbean, and Central America before expanding internationally.
While utilizing 4th generation and soon 5th generation wireless technology, it will also heavily incorporate blockchain and cryptocurrency technology, one of the 1st ISP’s in the world to do so and the 1st to tokenize their services using an Initial Coin Offering (ICO).
More information can be found on their website — www.HorizonComm.co
