IAME has been designed as a decentralized identification system that runs on the blockchain. The system will allow parties taking part in a blockchain transaction to verify the identity of one another without the need to disclose non-essential facts.
To achieve this, the system fragments information to an unintelligible level and with the help of third-party validators, verifies each fragment of data. The summation of the verification of fragments leads to complete identity verification. However, only the original owner retains the wholesomeness of their data.
More About IAME IAM
The major issue regulators face when thinking of integrating digital currency into the real economy is the ability to identify ownership of assets. Regulators need to be able to understand where you are getting the digital currencies and with who it is you are transacting. When the Bitcoin was being developed, these issues were never thought through. However, Bitcoin’s blockchain has remained the base architecture for all other existing projects that use the blockchain.
The developers of the IAME project are of the opinion that if the issue of identification is never resolved, mass integration may never happen. This is because regulators will always oppose anything that does not allow them to identify the source and destination of funds. Most regulators believe that digital currencies are a hotbed of money laundering because tracing the owners is so difficult.
The IAME project hopes to change all that by creating a new system of identification. In the current financial system, identification takes place via a process of wholesome surrender of personal data. This system was created decades ago in an effort to fight money laundering. However, it is not relevant in the current era of digital currency.
If the current standoff between digital currencies and regulators continues, it will lead to digital currencies being hurdled into a niche system where criminals are the ones who use it. Alternatively, it could slow down the crypto economy tremendously because of the weighty compliance threshold that will be placed on it.
The Current Challenge
The implementation of current identification protocols on the blockchain is not compatible with the ideals of decentralization. However, the principle of anonymity is at odds with regulatory requirement for anti-money laundering laws. Thus, there is a need to get to a compromise. This will enable the two sides to come to a symbiotic existence where everyone gets what they need.
The Solution That IAME Proposes
To arrive at a working solution, the IAME project proposes to reinvent the identification process. Thus, it proposes a change from a wholesome to a fragmented system. There will be clearly identified topological spaces, which can be used as a point of entry for regulators. The IAME network will thus seek to resolve the issue of anonymity without halting the blockchain revolution.
By creating a fragmented identification system, users of the blockchain can be able to validate their address without having to entrust sensitive data to every party with which they interact. However, it can still help regulators identify users to ensure they are not engaged in money laundering.