Altcoins Talks - Cryptocurrency Forum
Cryptocurrency Ecosystem => Decentralized Exchanges (DEX) => Topic started by: coingabbarmarket on October 17, 2023, 01:00:31 PM
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Uniswap v4 causing controversy with KYC hook in crypto community
A new Hook available on the open-source directory for Uniswap v4 Hook is causing controversy within the crypto community. Criticising Hook, a user wrote on X that Hook opens the possibility of Decentralised Finance Protocol (DeFi) being whitelisted by regulators. Hook enables users to check KYC of their customers before trading on the pool. KYC is mostly used by financial institutions to authenticate the identity of customers and detect illegal activities. Uniswap is ready to introduce v4 Hook Customizable Hook, which will be easy for government approved entities in early 2024.
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There is a clarification in Twitter that the KYC hook is a community feature, it is not built-in by default by Uniswap devs. Uniswap introduced custom hooks and someone built this KYC hook. Although Uniswap moves towards centralization and regulations for a while already.
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Currently, Defi, centered on DEXs, is in the sights of governments, especially the US government. They want to control to avoid money laundering and terrorist financing, even if only a very small amount of dirty money flows through crypto channels, most of which goes through USD. I think in the future, Defi will be managed like the Internet is today.
Many users in the community also do not want to be associated with dirty money because of legal risks, so many projects have been developed for AML/KYC purposes such as PureFi. Perhaps after the 2024 cycle, everything will be clear and the legal frameworks will determine Defi's official position in the economy.
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Currently, Defi, centered on DEXs, is in the sights of governments, especially the US government. They want to control to avoid money laundering and terrorist financing, even if only a very small amount of dirty money flows through crypto channels, most of which goes through USD. I think in the future, Defi will be managed like the Internet is today.
It is certain that the United States will not leave decentralized services alone. The United States is pursuing everyone, so it is natural that all decentralized services, including DEXs, will strive to be more compliant with money laundering and terrorist financing laws.
Imposing KYC on users is a better option for DEXs than shutting them down by the US government.
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It is certain that the United States will not leave decentralized services alone. The United States is pursuing everyone, so it is natural that all decentralized services, including DEXs, will strive to be more compliant with money laundering and terrorist financing laws.
Imposing KYC on users is a better option for DEXs than shutting them down by the US government.
What developers should do then is host their services where certain governments don't have any power, and there are several options for that. There are countries where, for example, the United States does not have the ability to close any services. But all this is the same as always, where some say “work against money laundering” I say “have greater control over the population”. No country should be the police of the world with excuses as stupid as that.
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What developers should do then is host their services where certain governments don't have any power, and there are several options for that. There are countries where, for example, the United States does not have the ability to close any services. But all this is the same as always, where some say “work against money laundering” I say “have greater control over the population”. No country should be the police of the world with excuses as stupid as that.
If I remember correctly, there have been cases where offshore services were being pursued because they still serve US customers. So other than moving overseas, the owner needs to make sure no US customers are using their services either by implementing a filter or doing a simple form of KYC. I'm sure the government is more than happy to argue that a simple "I'm not a US citizen" is enough to remove the responsibility of the owner to comply with their rules. This begs another question, why do some services host their servers in the US or somewhere close to it (geographically or politically), if they can be scrutinized easily? Is it simply because they live in the US,
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It would be terrible if DEX exchanges would start to introduce verification, there is a large cluster of people who use cryptocurrency just because they are anonymous and do not want to be seen, I'm not talking about scammers, which I'm sure are very few, let's hope that this will not be a mass .
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It would be terrible if DEX exchanges would start to introduce verification, there is a large cluster of people who use cryptocurrency just because they are anonymous and do not want to be seen, I'm not talking about scammers, which I'm sure are very few, let's hope that this will not be a mass .
It is too late for that I believe. Some 'decentralized' exchanges already filter users through their IP, and will likely force KYC sooner or later unless they are not based in the US. I'm positive the number of privacy-focused dex will not decrease that much though, especially if you use apps like Bisq (which is probably not the same as Uniswap in this case). As far as I can tell, other alternatives like 1inch is still okay to use if you don't like KYC. CMIIW.
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It would be terrible if DEX exchanges would start to introduce verification, there is a large cluster of people who use cryptocurrency just because they are anonymous and do not want to be seen, I'm not talking about scammers, which I'm sure are very few, let's hope that this will not be a mass .
It is too late for that I believe. Some 'decentralized' exchanges already filter users through their IP, and will likely force KYC sooner or later unless they are not based in the US. I'm positive the number of privacy-focused dex will not decrease that much though, especially if you use apps like Bisq (which is probably not the same as Uniswap in this case). As far as I can tell, other alternatives like 1inch is still okay to use if you don't like KYC. CMIIW.
Tracking by IP-addresses is not so simple, simply because it is solved by installing VPN or specialized application (or anti-detect browser) in which you can install proxies and no one will be able to identify you, there are other ways, but even these will completely hide you from unnecessary place and you can easily use those DEX exchanges that will introduce it.