The blockchain industry is booming, and regulatory forces are charging right along with it. While the average cryptocurrency user may not notice much of a difference in the logistical operations of their crypto-related activities, crypto exchanges around the globe have been forced to step up their ‘compliance game.’
Practically, this means that exchanges increasingly rely on identity-verification service providers to ensure that their KYC (know your customer) and AML (anti-money laundering) requirements are up to snuff. One such service provider that’s been making waves in the crypto space is the Cyprus-based AU10TIX.
Finance Magnates recently spoke to AU10TIX CEO Ron Atzmon about his company’s role in the blockchain industry, the effect of the GDPR, and the future of identity verification.
“Each One of Our Customers is Unique,” but They Share a Similar Set of Standards
“AU10TIX is an ID authentication company…but essentially, we are an image processing shop,” explained Ron. “In our ground-roots, we do document authentication…Any company that needs to authenticate its users could be our customer.” Ron added that eToro is one of AU10TIX’s oldest customers, but the company has more recently started working with Coinbase and Gemini.
“From one exchange to the other, they try to achieve the same standard level [of authentication and data security], but each one of our customers is unique by its behavior, by its needs and capabilities…not one is similar to another.”
AU10TIX Reports Record Demand in The Cryptocurrency (Bitcoin) Market for 2nd Generation ID Authentication & Onboarding Automation.
— Secure Customer Onboarding (@AU10TIXLimited) January 10, 2018
He went onto say that each one of the exchanges that AU10TIX works with “knows [its] customers better than we do, and we are here to support them.”
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“We don’t keep any data. AU10TIX doesn’t want to touch PII (personal identification information). I mean, we touch PII in the processing, but unlike any other vendors who may keep data, we just don’t…once you keep data, it’s a whole different ball game.”
The GDPR: “It’s Insane”
The GDPR went into effect this month, causing firms around the world to have to pour millions into updating their data security and data sharing systems. We asked Ron how the GDPR has affected his company as well as its customers.
“Whoever wrote the GDPR, I don’t really think they understood what they were writing in the first place,” Ron said. “I’ll give you an example: my contacts need to be GDPR compliant–it’s insane. I mean, my Outlook–so everybody needs to be GDPR compliant, even if you are manufacturing detergents. If you’re Proctor & Gamble, and your customer is Tesco, your data needs to be GDPR compliant.”
“Regulation is good,” he added, “but I don’t think that the people who wrote GDPR really understood all of the repercussions of what they are asking for. It’s not totally clear…the regulation says ‘do best effort.’ So, what is best effort? It’s open for interpretation.”
He continued to say that he believes that this particular kind of issue “is one of the major problems when you talk about regulation and compliance. It has to be much more clear. The problem is that the regulator is not willing to think of [the companies that the regulations affect] before their decision.”
Ron explained that the result of this is that if you ask two separate people (or two separate GDPR enforcement agencies) if a company is compliant, you might get two different answers. “It’s not cut clean,” he said.
“I totally understand where they’re coming from,” he added. However, “you can’t write such open-ended regulation. It has to be much more clear…because then you end up with different companies looking at the regulation in different ways.”
UK fraud levels at record high, with identity fraud “starring” at 95% of cases.
Identity fraud already increased 125% since 2007.
— Secure Customer Onboarding (@AU10TIXLimited) April 18, 2018
Ron Believes That GDPR Won’t Hold His Business Back
Despite the confusion lack of clarity that has resulted from the GDPR, Ron is hopeful for the future of AU10TIX. Over the next year, Ron sees “dramatic growth in our sector, globally,” for his company.
“Our customers say that we’re the most expensive service,” he continued. However, “we don’t charge that kind of price just because we feel like it. If you look at the grand scheme of things, we give good return on the investment, and it’s worth it.”