During the last two months of the past year, we ran an extensive social media campaign to educate our audience on everything about Veriscope and why it matters to the ecosystem's future. Before continuing with our educational series, we want to sum up all the key insights we covered during the campaign for a better understanding of what Veriscope actually is and why it matters.
First things first: the Travel Rule. With more countries enforcing the Travel Rule, Virtual Asset Service Providers (VASPs) have no choice but to comply. To be compliant while respecting user privacy, VASPs must solve two critical issues: address attribution and data transfer.
The attribution problem refers to the need to identify & provably verify the owner of a beneficiary wallet address accurately. As for the data transfer issue, it arises because there is no global framework for securely transferring Travel Rule data between VASPs.
Shyft Discover, the first component of Shyft Network's critical Travel Rule infrastructure, enables a VASP to know who their counterparty VASP is. This is crucial as VASPs share critical user data along with the crypto transaction to comply with the Travel Rule.
Sharing critical information with a wrong VASP having dubious intentions would constitute a data privacy breach. Here’s where Shyft Discover can make a difference, as it can save VASPs from such a predicament.
Click here to learn all about Shyft Discover.
Attestations enable Virtual Asset Service Providers (VASPs) to transmit user data along with a transaction while keeping user data confidential.
Analogically, the attestation workflow resembles sticking confidential notes on a public bulletin board. Click here to learn all about attestations.
When VASPs send or receive digital assets, they must share certain information with their counterparty to comply with the FATF Travel Rule, such as their users' names and wallet addresses.
Sending such sensitive data to the wrong VASP could have devastating consequences.
This is where Address Proofs come in. Click here for more information on Address Proofs and how they can help VASPs protect critical data.
Virtual Asset Service Providers can register and create a profile on the Shyft Network in order to participate in the network and take advantage of its features. However, to create a profile, VASPs must provide certain information about themselves.
The information can then be verified and validated by other parties on the network. The fundamental idea behind this step is that the more attestations a VASP's profile have, the higher the level of trust it has on the network.
Some Travel Rule solutions do handle the data-sharing part, but they process the sensitive user data through their servers before sending it to the relevant VASPs.
While this may seem convenient, it also carries certain risks. Veriscope Share solves these problems by enabling VASPs to share user data in a P2P, VASP-to-VASP mode. Head over to this Twitter thread to learn more about Veriscope Share: The Basics of Veriscope Share.
Veriscope Share's workflow begins when an originator VASP (oVASP), or the crypto business whose customer has requested a withdrawal, posts an attestation on the Shyft Network. The following flowchart describes the entire process:
We have covered the workflow of Veriscope Share in Part-3(4) of the Veriscope campaign.
The HTTPS-based Shyft Veriscope is an end-to-end solution designed to help virtual asset service providers (VASPs) comply with the crypto Travel Rule. All its payloads are encrypted.
Its impressive features include RESTful APIs, webhooks, and the option for on-premise installation. There are several advantages of using Shyft Veriscope, which you can find in Part-5(1) & Part-5(2) of our Veriscope social media campaign.
Outside Shyft Veriscope, facilitating user data transfer between VASPs for Travel Rule compliance is a complex and often suboptimal process.
One of the major issues with the current state of Travel Rule compliance is the wrongful interpretation of the Financial Action Task Force (FATF) recommendations, which causes various problems for VASPs.
Both Originator VASPs & Beneficiary VASPs have to engage in Name Screening, Wallet Screening, Know Your VASPs, and Transaction Threshold checks throughout the Travel Rule transaction workflow.
We looked into three unique cases to understand the workflow better in Part-6 of the Veriscope campaign.
To download Shyft Veriscope, VASPs must first visit the Veriscope Github repository. It contains the complete installer and various components needed to download Veriscope.
However, before VASPs start the installation process, they must ensure they have access to a server that meets specific requirements, as shown here.
There are two ways to test the Shyft Veriscope API: the Postman Collection and the Sandbox Environment. You can choose any of these two options. Click here to learn all
about the testing and onboarding phase.
VASPs need a Travel Rule Solution to begin complying with the FATF Travel Rule. So, have you zeroed in on it yet? Check out Veriscope, the only frictionless crypto Travel Rule compliance solution.
Visit our website to read more: https://www.shyft.network/veriscope, and contact our team for a discussion: https://www.shyft.network/contact.
Also, follow us on Twitter, LinkedIn, Discord, Telegram, and Medium for up-to-date news from the world of crypto regulations. Also, sign up for our newsletter to keep up-to-date on all things crypto regulations.