The rise of Decentralized Financial services or “DeFi” deserves sober consideration.
It has the potential to disrupt the existing financial system, bringing with it both risk and reward. The opportunity DeFi generates for all participants in the financial sector, be that investors, businesses, creditors or consumer, are too great to sweep under one regulatory rug.
Astra’s mission is to equip the DeFi world with a fully decentralized and flexible compliance layer — liberating the future growth of the financial industry.
Most recent news suggests that Decentralized Finance is being used as a haven by criminals and kleptocrats to launder hundreds of billions of dollars a year, circumventing the existing traditional financial systems. Regulators fear that the government entities that enforce laws against money laundering would be replaced by another system, too difficult for them to control effectively.
Times are constantly changing for the world of Decentralized Finance. From its inception, DeFi saw immediate and substantial growth. Now, the innovative space must adapt to continue its rising path.
Lack of regulation is the primary reason why cryptocurrencies face significant challenges with AML. According to Chainalysis’ 2021 Report, in 2020, the criminal transaction volume and money laundered involving cryptocurrency was around $10.0 billion. To regulators this is evidently too high to disregard!
The first step in implementing AML is through the integration of KYC procedures into DeFi protocols. Updated guidance from the Financial Action Task Force (FATF), if finalized, would ask countries to ensure that DeFi platforms have some form of KYC rules, even if there’s technically no single party responsible for a live network. According to the FATF, KYC is a major tool that the global authority intends to use to counteract money laundering and enhance consumer protection.
Astra is the answer for both the Decentralized Finance space and those regulatory concerns. Astra has been designed and built to verify information in different settings. Through technology layer Delegates (API’s), the Astra platform can complete decentralized KYC and KYB checks independently, faster, and is more cost-effective than any comparable service.