Binance Offers Decentralized KYC for Wallets Using Soulbound Tokens
As a decentralized solution to the KYC requirements for the exchange, Binance introduced BAB, a Soulbound Token on the BNB Chain. Soulbound Tokens are NFTs that are not transferable across wallets.
The NFT may be used to identify the owner of the wallet on the blockchain even if it cannot be traded. To identify recorded activities by the wallet, such as engaging with a dApp or smart contract, data connected to the NFT can be used.
The Binance Account Bound (BAB) token “will certify the wallet owner’s verified user status on Binance and will also be available for use by third-party protocols.”
Customers of Binance will be able to opt out of owning BAB by choosing whether to perform a KYC check using the Soulbound Token or more conventional methods.
Owning a BAB token will initially just signify that a wallet owner has passed the Binance KYC process, and the token will not include any more user information. But in the future, “Binance may issue other types of BAB tokens” with more applications and features.
“Soulbound Tokens will play a significant role in the way web3 credentials will work in a Decentralized Society… We foresee numerous use cases for the BAB token, and we will actively collaborate with the community to develop this revolutionary vision of decentralized society,” Binance CEO Changpeng Zhao said.
The BAB token is the first Souldbound Token to be launched on the BNB Chain, though it is not the first to be produced. In June, Phala Network said that it has introduced Soulbound Tokens, which link characteristics to certain in-game avatars. Additionally, Idexo has disclosed support for Soulbound Tokens within its web3 SDK, enabling developers to incorporate the tokens into applications “with just 1 line of code.”
DISCLAIMER: The Information on this website is provided as general market commentary and does not constitute investment advice. We encourage you to do your own research before investing.
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