The Defi world has advanced to backing up Defi pools with Real World Asset(RWA).
People can now borrow on Defi protocols like Centrifuge by depositing their RWA like invoices, mortgage, royalties, and goods as collateral. These RWA are tokenized as nft and deposited in Centrifuge pool to exchange for stable coins.
However, the operating RWA Defi protocols at present require their users to provide Know Your Client documents (KYC) through existing KYC service providers. This made a well-known algostable protocol to consider the idea too expensive to buy.
This is because the government might come at any time with its laws and policies trying to disrupt the system. To indict users will be easy since government can influence the KYC service providers.
RWA-Defi is truly a breakthrough in Defi world and a facilitation of Cryptocurrencies mass adoption. However, integrating genuinely pseudonymous money with real-world assets creates huge potential liabilities. A good idea is to bring Zero-knowledge Know Your Client (ZkKYC), which would tick all the legal requirements of fiat KYC while concealing the broader subgraph of that user’s assets and transactions.
To bring ZkKYC to RWA-DEFI a protocol with the following capabilities is needed:
Shielded address transactions.
Point-to-point encryption of addresses and amounts.
Keeping transaction costs for common use cases low.
Built via a common crypto language (Rust or Solidity), to scale developer adoption.
A thorough research results that SecretNetwork is the only Blockchain in existence at this time and capable of bringing anonymity to RWA-DEFI. As is it’s built to use Trusted Execution Environments for off-chain transactions.
Hope is that SECRETNETWORK will offer this service to RWA-DEFI in the future. If it does, then heads-up but till then let’s enjoy the thrive of RWA-DEFI in the cryptospacce for the time being.