Here’s an article submitted by Jitendra Rathod, newsletter contributing editor, that discusses the challenges of the current KYC processes at crypto exchanges and how UKYC can help.

Cryptocurrencies have already hijacked the debate about the Fintech sector because of their unconventional and disruptive approaches to finance, which is also why they have been able to make their mark. Initially, at the inception of cryptocurrencies, the users’ anonymity had been at the heart of the technology and all the systems.

The anonymity was not merely a decision to set itself apart from the conventional financial systems; it was a well thought out ethical decision. The aim of this was to include the under-banked into the financial system.

However, this did not work out too well for the crypto community; and soon cryptocurrencies were alleged to be mediums of money laundering and tax evasion. They were also charged with facilitating funding for illegal activities of various kinds. It soon became clear that in order to be able to maintain the legitimacy of the cryptocurrencies, the community will have to compromise some of its fundamental principles.

This lack of transparency of the crypto-based transactions led the regulatory authorities in several countries to tighten the rules regarding the joining and usage of crypto-based services. The exchanges thus now have to acquire information from the users in accordance with the KYC (Know Your Customer), and AML (Anti Money Laundering) norms set by the regulators of the respective countries of function. It is in this respect that different services are coming up to cater to the needs of the crypto industry.

Challenges with KYC/AML

While this provided the much-needed transparency to the cryptocurrency transactions, it also saw some resistance from within the community. One significant complaint against the KYC norms is the question of privacy. This question is, in fact, multifaceted.

Firstly crypto transactions are based on blockchains, that is to say, they are based on public ledgers. As a result, each transaction is added to the master ledger. When the thread of the transaction is traced to the source and matched with the real life identity of the individual, it reveals sensitive transaction information. Initially the real life identity of an individual could not have been located but with KYC it is possible to reveal the identity of a person owning an account.

In simple terms, before KYC there was complete anonymity for the addresses on the ledger, but with KYC a simple breach of trust can reveal all sensitive transaction details. Thus, uploading specific sensitive information, like address, name, and sex to name a few can significantly put the privacy of the users at risk.

The second risk related to privacy is that the user uploading his or her information on the crypto exchanges risks losing data to hacking attacks. While thousands of users are on these platforms, it becomes the responsibility of the exchanges to manage and secure these data, which are highly valuable. For a user using many platforms it becomes even more risky, to upload such data over several platforms.

Moreover, the process of seeking and managing such vast amounts of data is expensive and time-consuming. On average, a traditional onboarding process in the brick and mortar financial institutions in general takes between 10 days to 2 weeks. Now, even though crypto exchange platforms are far swifter and efficient in this task, it is still somewhat of a hassle for them to deal with such huge amounts of data. Thus, not only is this a cumbersome activity for the user, but the exchanges themselves find these norms to be a burden. They often realize that such regulations are making their functioning a challenge.

The exchanges which continue to function from the highly regulated regions find it increasingly difficult to focus on their core operations and have to channelize a large chunk of their resources towards the management of such data. This reduces the quality of the products.

Problems with Existing KYC Processes

There are two major problems with the existing KYC processes on the various crypto platforms:

  1. Different KYC for different exchange platforms: currently, every exchange has its own KYC process. As a result, in order to join different platforms the user has to undergo the verification process over and over again. So if a person holds accounts in 10 different exchanges, he/she has to submit physical or scanned copies of documents at all these places.
  2. Risk to safety:Since, the user has no way of knowing how his/her personal information is being used or handled, there is a serious risk to privacy. She has no option but to trust that this data (her photo, a photo of her passport, for instance) will be safe in the hands of the exchange and will be used only for the purpose it is intended.

UKYC: The Expanse Solution

The Universal Know Your Customer module created by Expanse as part of the Tokenlab ecosystem, is one of its kind, for it can be used for all those platforms wherever it is necessary to validate the identity of the users. The user has to fulfill all the KYC requirements on this platform in the beginning, i.e., at the time of signing up.

Once the KYC requirements have been fulfilled, the user gets a personal profile. On this platform, each user’s profile is given a badge in the form of a barcode. It is a single unified badge which is valid for all the platforms and exchanges requiring KYC.

The bar code can be scanned every time the user needs to provide the KYC. The information remains stored at one point and can be accessed by different kinds of firms, thereby saving the user from the hassle of repeated KYC verifications. Moreover, as the profile information is in the form of a barcode, the user can secure anonymity to some extent.


In this day and age of discussions about the safety of personal data and providing the same data over and over again, UKYC comes across as a kind of savior. It also reduces the processing time of the data, and makes the process more accountable to the user, who now knows where her data is being stored. In this way, UKYC is an efficient approach to KYC. It can also have a significant effect in providing stability to the unregulated, or poorly regulated, crypto market.


We continue to make progress on the alpha version of Universal Know Your Customer (UKYC). Although we’ve made some new decisions about the programming language that has resulted in some delays, we still project its release 1st quarter.


We have expanded the scope of Tokenlab 2.0 features. The result is a  delay in the new version hand-off to beta-testers. Among the new features are:

  • Additional templates/protocols – ETH is added.
  • Deployment options now include Ethereum.
  • Ability to use a coupon code for payment, defining a percentage discount amount per token distribution.
  • New token management tools through the Admin Panel that allow you to manage distribution of your tokens.

Beta-testing should begin this week. Testers will receive a message with instructions when it is time to get started.  

Exchange Listing Update

At press time, Beaxy Exchange has again affirmed that Expanse (EXP) will be announced as a round-three listing.  EXP will be available for trading when the exchange first launches.

The Equicex Exchange announced that they listed EXP on Twitter last week. We do not have confidence in them as of yet and cannot yet recommend them to our community. We will let you know if anything changes, and we welcome any feedback you may have on your experience with them.

Bitstickers added Expanse as a payment method recently. This basically means you can buy or pay for any product or service in their system with Expanse. Bitstickers is a  group of bitcoin enthusiasts trying to promote the utility of bitcoin to the world. Read more here:

There have been a few changes to our roadmap since last published. Note that, while we are hesitant to commit to exact release dates, (that rarely works), we have provided the projects in order of anticipated release timeframe.

  1. Token Creation Wizard (Launched): Using smart contract technology, create utility tokens for your project. Let the wizard lead you through creating, naming and setting parameters for your token. Launch your token on the Expanse blockchain.
  2. Tokenlab 2.0: Token Manager and coupon functionality
  3. UKYC™: Use the Universal Know Your Customer (UKYC™) Identity Verification module for user identity verification wherever it is required.
  4. EXPEX: Our new decentralized exchange, EXPEX, launches inside the Luna Wallet, allowing peer-to-peer trading services.
  5. Luna Wallet, 2.0: The next generation of the Expanse Luna Wallet with rich new features.
  6. Module Marketplace: Find useful utilities (dApps) to help you manage and market your token-based business.
  7. Tokenlab Crowdfunding: The Tokenlab crowdfunding platform provides a variety of solutions for crowdfunding. License our software to run on your own servers or use the self-service portal available from our website.

Gameboard has made significant progress this month.The latest, in a series of exciting updates, is the introduction of GXP, (Gameboard Experience Points), which is the new Gameboard token for its gamified platforms.GXP has been deployed on the Expanse blockchain.

The goal of Gameboard is to build an API that allows you to apply game theory to a non-gaming application. It provides the mechanical functions of bringing points, levels, badges and rewards in a simpler way. So we leave the game design and the dynamics to the game designers.

Gameboard can not only be integrated into any system,  but it can also unify information from various systems to have constant and comprehensive feedback from its users.

Here’s an example use case:

In the case of  a logistics company, we could connect Gameboard to its’ access control system and record the arrival time, then integrate to the computer registration system and record the time an employee starts working. If we assign points to these actions and duplicate it, and if this time is less than the average, we will reward the execution of these tasks as follows: “If you go to work on time from Monday to Thursday, you can leave after lunch on Friday.” That would be cheaper for the company than if every day the employees arrive late and also take a long time to start working.

In this day and age where companies are looking to save costs, it pays to “reward” employees when you can motivate them to perform certain tasks in a game setting. In short, It is cheaper to reward them than to stop motivating them. This is based on the fact that 70 percent of the world’s workforce are millennials, and millennials work for rewards. Going back to the issue of points and prizes, the company will invest a lot of money in prizes used to change behavior or achieve goals, so that the actions become electronic values ​​that are of interest to the player (employee of the logistics company). This is an excellent use case for the Blockchain.

“Implementing a gamified platform makes the points become a financial cost, but they generate value by producing a higher productivity and measurement system,” said Andres Garcia, Gameboard CFO.

For this reason we use the Expanse technology so that the management of points gets registered on the Blockchain. When a user earns points, he receives GXPs, and they can be stored in his wallet (Luna allows the management of our token) and then he can exchange these tokens for prizes that are preconfigured on the platform.

For companies to implement a gamified system is an investment, and we want to manage it on the blockchain, so that it is secure, distributed and permanent. If you want more information, visit us at

Here is a collection of compelling quotes posted over the last two weeks in our various Discord channels:

Christopher Franko shared, “Expanse has a clear purpose for creating the things we are creating. My purpose is I want to create a whole new infrastructure for the citizens of the world to use to transcend the nation state construct.

I want to create global citizens that all have access to the same infrastructure. Tools they can use to bootstrap themselves out of poverty and finally be able to fight our oppressors.Tokenlab marketplace and ukyc are two solid starting points to get where I want to be.With the marketplace people can launch their own nations, be their own Kings, share decentralized systems at will.”

A community member suggests,Create such an atmosphere that investors should feel like investing.  Reach those people, devise excellent RESULT oriented Strategies. Your coin is Good, so don’t finish it, take it to its desired position. Make it a leader again.”

Lastly, here’s a cartoon we love posted by @Bitjohn: