Fetch and Yoti join forces to bring KYC to autonomous DeFi agents

Fetch.ai, a project building a network of autonomous agents for blockchains, has announced a partnership with Yoti, a digital identity provider.

Blockchains, and DeFi smart contracts in particular, often require manual interactions to trigger specific events. These could be contract calls, particular exchange transactions, publishing oracle data and many more. While these actions are often permissionless or done by the developers of the smart contract, there may be circumstances where nobody is able to perform these actions. This is where Fetch comes in with its network of autonomous agents, as David Minarsch, Fetch lead economist told Cointelegraph:

“Fetch is built for autonomous interactions between agents and traditional Web2 kinds of architectures, but also between agents and DLT kind of architecture and thirdly, between agents and other agents.”

For the DeFi world, Fetch sees itself as automating more complex interactions that require constant monitoring. Minarsch cited the example of providing liquidity — users may want to get in and out of a particular liquidity pool to avoid periods of heavy impermanent loss, for example. This is somewhat similar to concepts like Yearn.finance, where developers create complex strategies to automate yield farming. Keep3r, another project launched by Andre Cronje, also uses the concept of agents to automate smart contract maintenance. “In my understanding, Keep3r is a subset of what autonomous agents can do,” said Minarsch.

Fetch has been mostly focused on enterprise uses of blockchain, but like for many other companies and projects, it began expanding to DeFi in 2020.

Nonetheless, its vision for the space is somewhat different from the prevailing attitudes in the community. As David Galindo, head of cryptography, said:

“If blockchain wants to gain more adoption than what it has at the moment [...] one of the things we need — apart from the tools to [become] more accessible — is to be able to link it to the real world, to the people that would use it. In particular, [it needs] to be accepted at some point by the regulators. And this is where the issue of identifying attributes of the people that are transacting becomes very relevant.”

On a practical level, the integration of digital identity for Fetch agents would be mostly seamless. The framework would abstract away many of the specifics, and the system ultimately relies on proofs — agents can be verified to have valid identities, but their personal data remains locked within Yoti. Law enforcement could then issue a request to acquire that particular user’s data, if required.

The system would also not change anything about existing protocols. The DeFi integration mostly relies on Fetch agents creating automated interactions with existing protocols, and the identity system would apply to the agents who perform these actions. Such a system could be particularly useful to certain venture and trading funds, who might have legal difficulties in interacting with DeFi.

Title: Fetch and Yoti join forces to bring KYC to autonomous DeFi agents
Sourced From: cointelegraph.com/news/fetch-and-yoti-join-forces-to-bring-kyc-to-autonomous-defi-agents
Published Date: Tue, 19 Jan 2021 14:13:01 +0000