Jumio biometrics to boost regulatory compliance and fraud reduction of bitcoin market Paxful
Peer-to-peer bitcoin marketplace Paxful has selected Jumio’s artificial intelligence-powered biometric identity verification to meet the platform’s know-your-customer (KYC) and anti-money laundering (AML) requirements, Bitcoin Magazine reports.
Jumio’s facial authentication and identity verification technology will help Paxful improve its onboarding and transaction authentication procedures to help with compliance and fraud reduction, according to the report.
“Prior to implementing Jumio, we had a zero-tolerance system for scammers, fraud and any other illicit financial crime,” Paxful Co-founder and CEO Ray Youssef explained to Bitcoin Magazine. “We required all customers to verify their accounts through email and phone verification [and] we encouraged them to use two-factor authentication for added protection to their account.”
Youssef says that Paxful chose Jumio’s facial biometric technology for its combination of effectiveness and ease of use for customers. Users are required to perform identity verification when they reach an equivalent of $1,500 in activity, and to verify their home addresses after reaching $10,000. The ability to perform these processes with a web camera, in addition to a smartphone, is important to Paxful, due to its large customer base in emerging markets, and was a key factor in selecting Jumio as ID verification partner.
Youssef claims that Paxful’s trading volume increased by 125 percent in 2018, largely due to an emerging cryptocurrency market in Africa.
“Africa is our top market and has reached an average of 17,000 trades per day,” he says. “Many Africans are used to KYC. For example, in Nigeria you must KYC with a fingerprint scan to get a SIM card for your phone. Africans have been preyed upon and exposed to great fraud risk so they welcome KYC if it will guarantee a safe and open system.”
Jumio recently integrated the ComplyAdvantage dynamic financial crime risk database for a new, fully automated AML screening solution, which Jumio VP of Marketing Dean Nicolls told Biometric Update can replace legacy solutions which may meet regulatory requirements without effectively detecting fraud.