[nowarninglabel]

Congrats on getting to this point! Been following Dharma closely for a little while now as we (Kiva) have an interest in trying to increase financial inclusion and decrease lending costs for the world's poor and have been hoping Dharma may end up being one piece to the future of our work.

Could you possibly speak to how you intend to enable KYC (Know Your Customer) / AML (Anti-Money Laundering) to work with Dharma? The best bet so far has seemed to be trying to incentivize it through providing automatic fees to external parties to perform these actions and holding the money in escrow until it goes through. However, it would be great if you could share if you'll have discussed this problem at all.

I'd love a world where we didn't have to deal with KYC & AML, but we do, and the sooner we figure out how to make it work in an efficient and inexpensive manner for the world's poor, the sooner we can reach the UN Sustainable Development goals around financial inclusion.

[nahollander]

Thank you! :)

We've pretty deliberately opted out of baking jurisdiction-specific protections (be they KYC / AML, accreditation, etc.) into the protocol insofar as we really want this to be a universal standard that's jurisdiction-agnostic -- to give a somewhat crass analogy, most developers would agree that it does not make sense for content-protection against, say, child pornography, to sit at the level of TCP / IP. Jurisdictions vary widely in how they treat lending law, and so we've opted to be as flexible as possible on a technical level.

With that being said, we're actively working on making sure that, at layers above the protocol, developers have an easy time plugging in / restricting functionality on the basis of regulatory parameters. There are several interesting projects in the decentralized identity space that are tackling ways of natively attesting to KYC / AML screening on blockchains like Ethereum, and we're actively in conversations with them to make sure we maintain compatibility.

[CryptoBard]

I also work in the exchange space like you used to and my thinking is pretty much fully aligned with the way you pose the issue and I'm very excited about your intention behind Dharma. I also agree with your current thoughts on approaching KYC and AML (please see my post in response to this one's parent). I'll reach out to you via your website if you don't mind since HN doesn't have PMs, would love to figure out if there's a way I can contribute.

[CryptoBard]

I am an engineer at a Coinbase competitor company and I have been thinking about this problem (massive amounts of crypto assets lying dormant) and possible leverage (global access to a universal debt market) and I have been researching Kiva since it seems to be the early player in this space. My 2c - Yes KYC and AML is important but it doesn't make sense relying on national identity documentation and storing everyone's PII in your own database. There's a ton of companies working on identity solutions where the user retains ownership of their sensitive information. With GDPR catching on and similar regional legislation popping up pretty much everywhere outside the EU, KYC and AML information pose a significant liability (and rightly so!) to companies in the fintech space. Especially so for early entrepreneurs who want to innovate but don't have the risk and compliance teams to deal with such sensitive information.

The proper solution is not to hold people's PII at all and depend on a provider (ThisIsMe, Civic, Consent, IDNow, etc, etc, etc, etc) combined with the customer's social graph information. If you want to know your customer, you need to know the people who knows your customer. After-all, who knows you better than your family and friends?

[nowarninglabel]

Yes, I whole-heartedly agree, the user should own their PII and who has access to it, but the KYC and AML checks still have to happen. Having a provider do it is also great, but Civic (as one of your examples) has explicitly stated they can't do it in international low-income contexts, and they are unlikely to ever be able to in a way that makes financial sense.

That's why folks in this space need to be thinking about how to solve this problem. There's not a clear, easy answer (or if there is it has not been communicated out enough otherwise everyone would be using it).

[himom]

I remember putting money into Kiva around 2007, it was increments of $50 IIRC.

Unfortunately, I lost a job and the ability to work, spent 401k, went bankrupt and lost access to the email address to my Kiva account. It seems ironic as I no longer have even $5. I don’t really worry about money anymore with serious endocrinological, ophthalmological and neurological problems... sleeping 12 hours and awake for 60 hours might place small limitations on life.