Coinbase, the leading U.S. cryptocurrency exchange, has just rolled out a groundbreaking feature — Coinbase Verifications.
This initiative marks a significant stride in incorporating decentralized identity (DID) into the mainstream, a development that's been a long-awaited piece in the puzzle of web3.
What's New with Coinbase Verifications?
Coinbase Verifications allows over 100 million users to confirm their account and country credentials directly on the blockchain.
This service is powered by Coinbase's Layer 2 network, Base, and leverages the Ethereum Attestation Service, an open-source standard.
This setup ensures that verifications are not only public but also composable, adding a new layer of transparency and security to the process.
Why is this a Game-Changer?
Enhanced Security and Transparency: By moving identity verification to the blockchain protocol level, Coinbase is tackling the common challenges of traditional KYC methods. This shift promises increased security and transparency for users and the platform.
Decentralized Identity (DID) Integration: The adoption of DID has been a missing component in the web3 framework. DIDs are pivotal in countering Sybil attacks—where a single node creates numerous fake identities—and enabling fundamental applications like unsecured loans and improved governance models.
Versatility and Public Accessibility: The Ethereum Attestation Service forms the base layer of this system, where users can make declarations and add virtual signatures. This flexibility allows attestations on any topic, both on-chain and off-chain, broadening the scope of use cases.
The Immediate Impact
In just one day post-launch, Coinbase logged over 9,300 verifications, a figure that represents about 15% of all verifications on the Ethereum Attestation Service.
Jesse Pollak, the creator of Base, envisions this service as a step towards enabling the next billion users to join the blockchain ecosystem.
Proof of Humanity, Fractal ID, and even tech giants like IBM and Microsoft, have ventured into DID.
However, Coinbase's use of a public blockchain for this service sets it apart, potentially paving the way for a network of KYC providers operating in tandem in the future.
This development is more than just a feature—it's a testament to the evolving nature of blockchain technology and its potential to revolutionize not just finance but identity verification and digital trust.
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