Why KYC Data Is a Hacker Target and How to Fix Identity Verification

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Know Your Customer (KYC) data collected by financial and crypto services has become a prime target for hackers due to its concentrated, sensitive nature. Coin Center's Laz Pieper argues that the current model of storing personal identity data creates dangerous honeypots for cybercriminals. Pieper advocates for privacy-preserving identity verification systems as a safer alternative to traditional KYC practices. Such systems would allow users to prove only the specific information a service requires, without exposing underlying personal data. This approach would give individuals greater control over their own identity information while reducing the risk of large-scale data breaches.

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