The magic of the number 7

What’s the catch here? Well, the folks behind ICO Pass claim that they can do KYC checks fast (7 minutes instead of 20), inexpensively (7€ instead of 230€) and the last, but not in the world least, they will return 7% of quarterly revenue back to the investors.

Sounds good? Let’s delve in. According to the folks behind Notakey,

ICO Pass is a suite of tools for gathering, verification and exchange of know-your-customer (KYC) information. The target audience are tokensale organizers on the Ethereum blockchain. For each contributor, ICO Pass gathers:

— full name

— date of birth

— e-mail

— mobile phone number

— nationality and country of residence

— address of residency

— photo of ID document

— photo of person.

This information is then authenticated against many backing providers. The early version will use Onfido (an identity verification engine for enterprises), but later versions will use more providers for increased accuracy. Afterwards this info is passed on to be signed with an ICO Pass key, then encrypted against the public crowdsale address and finally published to IPFS (a peer-to-peer hypermedia protocol).

For tokensale organizers ICO Pass will provide a suite of tools to manage KYC information. For contributors ICO Pass will publish a mobile application, which facilitates the gathering of KYC information. There will be a small fee, done in ETH, for the contributors to prove their address ownership. This fee will be refunded (minus the network tx costs, which will befall, at least initially, to the contributor).

An overview of the ICO Pass KYC process

According to the ICO Pass website, there are 7 (remember the magic number?) reasons why ICO Pass is superior to what’s out there at the moment

Automatic vs manual

Manual KYC checks are lenghty and prone to human error.

2. Accuracy vs inaccuracy

ICO Pass can utilize multiple databases whilst traditional methods rely only on few at most.

3. Transparency vs opacity

ICO Pass gives out data why a certain result occurred, i.e. what databases were checked and what results obtained.

4. Immutability vs malleability

Current methods of KYC checks can be tampered with. ICO Pass utilizes the Ethereum blockchain, thus verifying that once something is written on the blockchain, it cannot be changed.

5. GDPR vs non-GDPR compliant

General Data Privacy Regulation in the EU is the most robust privacy regulation in the world, which is about to be enforced in May 2018. Current KYC methods would need to do additional measures to comply with this regulation whilst ICO Pass’ encryption deals with it already.

6. Expensive vs inexpensive

Traditional methods would have to use huge amounts of money to keep the identity data secure whilst with ICO Pass the information is encrypted and only accessible to the person at hand

7. Cost: 7€ vs 230€

The most secure method at the moment to do KYC checks is by Bitcoin Suisse, a Swiss-based financial service provider specializing in crypto assets, but it costs 230€ per check. This is way too much for many ICO’s to handle (thus many don’t bother). ICO Pass has streamlined the process so that it costs a mere 7€ to do a single check.

The founders of another startup going through MANUALLY over 5k KYCs! Need a hand?

What is extremely cool is that the KYC info will be reusable for use in other ICO’s, should the crowdsale host decide so. This is very handy for the shot-gun investor who seeks allocations in promising blockchain startups. Anyone who has done a KYC know it can be tedious. One KYC procedure asked for two prior residential addresses and move dates. Digging up this kind of information is both time-consuming and a nuisance.