VERISCOPE

Verified Shyft Compliant Optimized Participant Exchanges

The complete solution to the FATF Travel Rule and global regulatory Compliance.

Veriscope is a blockchain-based compliance framework and smart contract platform for Virtual Asset Service Providers (VASPs).

VERISCOPE, One Solution.

Shyft Secure

Shyft Coalition

The Verified Shyft Compliant Optimized Participant Exchange (Veriscope) system was designed as a smart contract mediated data coordination infrastructure, intended to provide a global discovery and validation ecosystem to solve regulatory guidance mandated through the Financial Action Task Force.

The Veriscope Discovery and Coordination Layer

How it works:

The goal of Veriscope is to enable VASP discovery by making cryptographic associations between three different objects:

  • The outgoing cryptocurrency address.
  • The sending VASP's public Shyft Network address.
  • The Shyft Network public address of the VASP's user.

A VASP writes an attestation claim to the network, which acts as a Request for Response to other VASPs on the network that can respond to this claim.

  • If a VASP on the Veriscope Network sees that an attestation of a cryptocurrency address, associated with one of their users has been made, they can use Shyft Network's smart contract system to respond to that attestation.
  • This response, and set of simultaneous handshakes, kick off an off-chain communication channel which then allows them to share sensitive travel rule information across both counterparties.

What is the FATF Travel Rule?

Shyft Reporting

FATF Travel Rule

The Financial Action Task Force(FATF) issued a guidance requiring Virtual Asset Service Providers (VASPs) to share Personal Identifiable Information (PII) and Know-Your-Customer (KYC) data between transacting senders and receivers before executing transactions.

This guidance, called the Travel Rule, is enforced in the traditional finance space between counterparties such as banks who use SWIFT for both transaction settlement and identity data sharing.

Key Stakeholders

Shyft Minimize Risk

Financial Action Task Force

Intergovernmental organization, (FATF) that focuses on the development of policies to combat money laundering and terrorism financing. It monitors progress in implementing the FATF Recommendations through "peer reviews" ("mutual evaluations") of member countries; it also maintains two lists of nations depending on their level of compliance or adherence to AML regulation and controls: the FATF Blacklist and FATF Greylist.

Shyft Reporting

Virtual Asset Service Providers

VASPs: any entity engaged in digital asset custody, such as:

  • Cryptocurrency exchanges
  • Non-custodial wallets
  • OTC desks
  • Brokerage firms

Trust, Coordination, and Discoverability

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Trust

Veriscope enables the evolution of online trust by applying consent frameworks and codified rules of engagement to digital ecosystems.

Shyft Network infrastructure does not hold or facilitate the sending/receiving of any private or regulated data.

Shyft Reporting

Coordination

VASPs can form coalitions, or trust channels, between known peers and industry participants, and they can pre-validate compliance and custody procedures.

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Discoverability

Participants can whitelist exchange addresses and privacy-preserving individual PII data attestations on a shared registry internal to the coalition.

Shyft Reporting

Key Principles

Data protection: Individual KYC data must be protected, and the individual needs to be able to consent to any KYC data sharing.

Collaborative self-regulatory system for competitors: VASPs shouldn’t have to trust each other to do business, but must be able to communicate, set business rules, and exchange information with each other.

Auditability: Data sharing processes and trails and data custody standards must be auditable by all applicable VASPs, end users, and regulatory bodies.

Flexibility: Any technology stack used for adherence to current regulations must be upgradable to enforce future regulations.

Business use: The framework must present acceptable risk and cost models for VASPs.

Interoperability: The framework must be usable for today’s intermediaries (VASP types, protocols, data transfer rails, transaction analysis companies, identity verifiers, etc.)

VASPScan: the VASP Transaction explorer

Shyft Block Explorer

VASPscan is the world’s first VASP explorer, providing a detailed view of real-time transactions from VASP claimed addresses, and enabling a permanent link between VASPs and their cryptocurrency transactions, while still maintaining crypto asset fungibility and anonymizing Personally Identifiable Information (PII).

A Block Explorer is a tool that provides detailed information about blocks, addresses, and transactions. We have created our own explorer that gives VASP’s the ability to publicly view and lookup VASP-enabled addresses, transactions and various details that take place on the network, while protecting anonymity.

VASPscan identifies attestations in transactions, allowing VASPs to discover counterparties and complete associated cryptocurrency transactions that require FATF compliance.

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