How Oobit’s solutions will enable a seamless KYC for crypto users and set a new market standard

Oobit solutions target to make KYC easier for crypto users across various exchanges so that they may choose the best option for their needs. Right now, KYC is painful, time-consuming and repetitive.

In our previous article, we touched on the importance of enhancing liquidity and user experience to drive user-end adoption of cryptocurrency (crypto) and blockchain. We discuss in-depth the role of KYC in the crypto and blockchain ecosystem, starting with the existing pain-points, the possible solutions and why a faster, higher-quality KYC for crypto users is vital to adoption.

Ac­cord­ing to Pw­C’s Global Con­sumer In­sight Sur­vey 2019, 86 percent of mainland Chi­na’s pop­u­la­tion are using mo­bile pay­ments in 2019. This is the highest mobile payment penetration rate in the world, more than two times higher than the global average of 34 percent. And the key to this is ease of use — the Chinese can buy anything from roasted chestnuts to a Lamborghini sports car — with a swipe of their mobile phones.

We believe that cryptocurrencies are severely lacking in ease of use and trust in providers. Unlike the large incentives and support offered to the centralised payment technology companies in China, cryptocurrency is being curtailed by the global regulatory environment. It places a high premium on the use of cryptocurrencies, be it by users or merchants, especially in areas such as user acquisition and KYC. Service providers who are subject to these rules are battling against shifts in consumers’ attitudes where many value their privacy and become very vigilant against divulging their personal details when asked to “fill up a form”.

It is nonetheless true that KYC processes are necessary to protect against criminal activity. The unfortunate reality is that there has yet to be strong support for innovation in this field — KYC processes are onerous, time-consuming and repetitive.

This is where we feel that Oobit has created the golden standard for KYC, a sustainable solution directly addressing the ease of use versus regulation dilemma. “Users and merchants will increasingly want digital money that they can trust as we move towards a digitized and global world,” said Aharon Miller, CMO of Oobit. “With Oobit PASS, users choose to complete just one round of KYC that is reusable and in full respect of their data privacy rights, while fulfilling all necessary compliance needs of the service provider.”

Oobit PASS

Oobit PASS provides one-stop KYC verification that taps on various technologies to authenticate users’ identities and speed up the entire process:

1. Advanced Optical character recognition (OCR) parsing technology:

• l Digitally extract user details such as name, passport number, etc. from the ID submitted by a user. This has traditionally been done manually especially for non-English languages.
• l How the user wins: Less form-filling and a shorter application process.

2. Liveness detection technology:

• l Verify that the user undergoing KYC is a real person — not an AI-generated image — without manual verification.
• l How the user wins: No need to strike complicated poses (“place your right hand on the top of your head”). This helps to shorten the application process as well as waiting time.

3. Facial matching technology:

• l Determine the percentage match between the photo on the ID submitted and a facial image of the user captured during liveness detection.
• How the user wins: Oobit PASS will assign a rating and automatically approve applications that hit the threshold percentage match as decided by the exchange. With manual verification eliminated

Crypto exchanges and blockchain application owners are willing to adopt Oobit’s KYC checks as they hate KYC processes as much as their users (believe it or not!). It is costly to process KYC applications because of the manual processes involved and the specialty nature of compliance makes it difficult for them to innovate internally without consulting external vendors, especially when it comes to the technical expertise. From our partners’ point of view, it is a better utilisation of resources to focus on their core expertise and outsource the KYC details to us.

Respect for user data

The most differentiated aspect of Oobit PASS technology is the means in which the user’s data is stored. After going through the KYC analysis process, user data is not stored on Oobit’s servers — instead, an encrypted copy is kept together with the KYC results directly on the user’s local device. This means that the user data is not openly available online, providing an unprecedented level of security on top of speeding up the KYC submission process.

When a new exchange or service is authorized by the user to access the data, they will use a secure decryption channel that allows the exchange to retrieve the user’s information and KYC results. This information is also backed by validation processes to prevent tampering.

Oobit Hunter

Right now, many crypto users are focused on transactions based on their investment appetite and the latest market developments. However, users are often limited to the exchange(s) where they have passed KYC, and it is onerous to shop around for the best deal.

Through Oobit Hunter’s mobile app comparing partner exchanges that accept Oobit PASS’ KYC, users enjoy transparency in terms of fees (such as processing fees, trading fees, VIP promotions) and ease of use as they shortlist options that are best-suited to their needs since sophisticated traders also look at factors such as market depth, fulfillment type and trading volume.

Building an ecosystem of users and merchants

Our team is committed to our community and care deeply about user experience. This is why we seek to build an ecosystem by giving OBT tokens as incentives for crypto actions on our platform, such as submitting KYC through Oobit PASS or acting on a recommendation by the Oobit Hunter tool. All tokens issued in this format are purchased from the secondary market by merchants who benefit directly from the problems we are addressing. We believe this model helps investors make more informed crypto transactions while further reducing their transaction costs.

Just as importantly in terms of crypto and blockchain adoption, greater ease of use in terms of KYC is likely to bring about additional meaningful opportunities in everyday life to pay for goods and services using crypto-enabled mobile applications.

As shared earlier, many crypto exchanges and blockchain application owners do not have the volumes to justify specific investment in KYC technology. In our opinion, this is holding back the growth of crypto and blockchain adoption. Users are likely to go through KYC processes that deliver the most product value and choice. When merchants join the Oobit community, they have access to users who are KYC-compliant while providing a better user experience by not asking them to fill up another form. This, along with many other user-centric modules being developed by the Oobit team and community, will be the starting point for much greater accessibility and usability of cryptocurrencies and blockchain technology.