Op-ed: Not all blockchains need to be pseudonymous
Blockchain technology, particularly layer one protocols like Bitcoin and Ethereum, plays a crucial role in establishing fundamental rules and consensus mechanisms for blockchain networks. Enterprises can deploy their own layer one, known as "enterprise blockchain," to achieve business goals and offer compliant services. Regulatory compliance processes like KYC and AML are essential for preventing illegal activities in the financial industry, including cryptocurrency exchanges. While layer one blockchains pose challenges for direct implementation of AML and KYC, enterprise blockchains offer a more practical approach. Incorporating KYC and AML protocols on layer one protocols can provide financial transparency while preserving confidentiality through technologies like zero-knowledge proofs. New layer one blockchains with AML and KYC functionalities could incentivize new users to benefit from the technology.
