Unique Identity (UID) is a non-transferrable NFT representing Know-Your-Customer verification on chain. It is the first NFT for identity. It follows ERC-1155 standards, and is freely usable by any other protocol. No personally identifiable data is stored on-chain.
Know-Your-Customer verification is a check that ensures a person is actually who they say they are. Doing so prevents cases of fraud and any suspicious activities from occurring on the Goldfinch protocol.
Why this matters:
- It opens DeFi to an entirely new set of real-world participants, notably companies and financial institutions.
- It greatly expands the design space for new features and mechanisms on DeFi protocols.
How it works:
When a user completes their KYC process, Persona checks that they have a valid identity and are not a duplicate of other ones. Once verified by Persona, the user is eligible to get their UID. They do this by submitting an Ethereum transaction that mints the UID, which is a non-transferrable NFT that is sent to their address. There is a 0.00083 ETH fee (about $3) in addition to gas, in order to cover the cost of Persona’s service.
Then, when the user participates in protocols like Goldfinch, these protocols can check that they have this UID, ensuring they are unique and KYC’ed.
More: https://docs.goldfinch.finance/goldfinch/
