Defi Manual: Part 2 — Regulations
If you are using Defi, you probably cannot avoid regulations. There are many Defi projects. However, many platforms require an on-boarding process similar to Cefi.
Most frequently used regulations
KYC and AML are the most two common regulations.
What is KYC?
Know Your Customer requires service providers to make an effort to verify the identity of customers.
What is AML?
Anti-money Laundering requires service providers to know where the source of money comes from.
Less common requirements
Depends on the investment risks, service providers may want to clarify customers’ income information or proof of accredited investors in order to take more risks on their products.
Cefi onboarding process
When you open a bank account in any financial institution, they will be required to verify the user through photo identification issued by the government, user address, identification number, birthday, or any other unique identification combination. They will also ask your source of income,
Defi runs on Cefi Exchange
Most of Defi products are on the Cefi marketplace. Exchanges like Binance will require KYC and AML for users…
