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US Treasury Department Considers Embedding Digital Identity Verification Mechanism in DeFi Protocols
Summary: According to Cointelegraph, the US Treasury Department has initiated public consultation under the 'GENIUS Act' to explore integrating digital identity verification tools into DeFi smart contracts to combat illegal financial activities. The proposal includes automatically conducting KYC/AML checks on-chain through API interfaces, while also utilizing biometric technologies to reduce compliance costs. Banking industry groups have ...
According to Cointelegraph, the US Treasury Department has initiated public consultation under the 'GENIUS Act' to explore integrating digital identity verification tools into DeFi smart contracts to combat illegal financial activities. The proposal includes automatically conducting KYC/AML checks on-chain through API interfaces, while also utilizing biometric technologies to reduce compliance costs. Banking industry groups have warned that loopholes in stablecoin interest payment regulation could lead to a $6.6 trillion outflow of bank deposits. The public consultation will continue until October 17, 2025, after which the Treasury Department will submit a report to Congress and may introduce new regulations.
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Link: US Treasury Department Considers Embedding Digital Identity Verification Mechanism in DeFi Protocols [Copy]
