DeFi Education

Meet KeyFi: An AI Powered, Non-Custodial DeFi Dashboard

KeyFi has created a system that will help bridge the gap between Centralized Finance (CeFi) and Decentralized Finance (DeFi).
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KeyFi has created a system that will help bridge the gap between Centralized Finance (CeFi) and Decentralized Finance (DeFi). Among many other features, it offers a self-sovereign identity solution and also a non-custodial, open-source wallet.

There are many reasons to combine the DeFi and CeFi ecosystems, and KeyFi is one of the most developed solutions in the market today.

One of the biggest hurdles for using CeFi platforms is AML/KYC regulations. While there are still many options in the crypto space that have little or no AML/KYC regulations, anytime a person wants to enter the fiat currency world, there will be some level of oversight.

In practical terms, these AML/KYC barriers make things complex for anyone that wants to utilize both crypto and fiat assets. While some exchanges, such as Binance, have created robust tools for fiat currency and crypto, as a market, these two systems are still very much divided.

Stake, rebalance, or yield farm using major DeFi platforms and earn KEYFI rewards along the way.
Stake, rebalance, or yield farm using major DeFi platforms and earn KEYFI rewards along the way.

KeyFi is Flattening the Regulatory Landscape

KeyFi is approaching the CeFi and DeFi conundrum from a few angles. One of the most innovative is the first credentials based DeFi token, and its SelfKey Credentials platform. The world of AML/KYC relies on the extensive use of personal data to verify the identity of a person within the banking system.

In practice, this means sharing loads of personal data, which isn’t always kept safe by the bank or financial institution. While banks are required to abide by relevant AML/KYC procedures, they don’t face consequences when consumer data is lost to hackers, which puts retail banking customers in a tough spot.

As 2020 has demonstrated, major economies will be looking to put tighter regulations on crypto assets, which means that platforms like KeyFi will likely be vital for the development of the industry going forward.

Ultimately more regulations are likely good for the industry, as more capital will enter the market due to higher levels of confidence in the platforms.

The KeyFi Dashboard
The KeyFi Dashboard

Creating Synergies

KeyFi is connecting users with some of the most popular DeFi platforms like Aave, Uniswap, and Compound, while also allowing its users to gain KEYFI tokens when taking advantage of the SelfKey Credentials system.

Like many DeFi platforms, KeyFi allows users to gain from either staking KEY, or acting as a liquidity provider for other platforms via KEYFI.com.

In addition to acting as a hub for popular DeFi platforms, KeyFi also introduced the following innovations:

  • Market Insights: KeyFi allows users to take advantage of data-driven AI market analysis.
  • Self Key Credentials System: By using the SelfKey Credentials system, KeyFi users can interface with some of the most popular DeFi platforms, and not have to share more personal information than is necessary. Additionally, personal information is never stored on-chain.
  • Powerful AI: KeyFi includes the use of a powerful AI that analyzes a deep historical dataset to provide information to users about potential future returns in the DeFi space.
  • Rewards: As an incentive, KeyFi users can earn extra rewards in the form of KEYFI tokens by providing liquidity, or staking KEY tokens.
  • Multi-platform Performance: KeyFi provides support for a range of deposit types, as well as connectivity with Compound, Balancer, Uniswap, Curve, and Aave, among others.
  • SelfKey wallet: A safe way to interface with multiple exchanges. Learn more about how to get started with the SelfKey wallet by clicking here.

The Global Regulatory Push

As Bitcoin prices return to all-time highs, there is a growing movement at the highest levels of government to regulate tokens. Unlike some nations, the new calls from the USA and EU seem to focus on increasing transparency in the crypto markets, not an outright ban on tokens.

In a recent press release, the Finance Minister of France, Bruno Le Maire, stated,

“This ordinance strengthens the fight against the anonymity of transactions in digital assets by including digital asset service providers (PSAN) among the entities having the ban on keeping anonymous accounts. New regulatory provisions will be presented in order to speed up the launch of the market for digital identity solutions for digital asset transactions. This request, which emanates from actors in the ecosystem, will make it possible to fight against anonymity transactions in digital assets while facilitating user identification.”

Le Maire is referring to new regulations that require companies operating in France to comply with AML/KYC regulations that prevent anonymous persons from using crypto companies in the nation. This isn’t an isolated move, and both the EU and the USA are working on new ways to increase AML/KYC compliance in the crypto sector.

In fact, US Treasury Secretary Steven Mnuchin recently held talks with representatives from Italy, Japan, the U.K., Canada, France, Germany, the Eurogroup, and the European Commission, Top-level representatives from the World Bank, the Financial Stability Board (FSB), and the International Monetary Fund (IMF) were also in attendance.

According to Mnuchin,

“There is strong support across the G7 on the need to regulate digital currencies…Ministers and Governors reiterated support for the G7 joint statement on digital payments issued in October,”

One of the most important tools that governments have in the financial sector is AML/KYC programs, so it is likely that any company that is operating in the crypto space will need to focus on these systems in order to remain operational if they are based in the USA or EU.

While these regulations are not always popular, they can actually help the DeFi and crypto space attract new forms of capital, much like the recent move by PayPal to allow the trading and use of popular tokens on its platform spurred, even more, buying by new crypto investors.

KeyFi is Well Placed to Grow in an Evolving Marketpalce

The massive rush into DeFi projects during 2020 was clearly a speculative bubble, but best-in-breed projects have a bright future in front of them. Platforms like Polkadot will likely continue to attract both investors and developers, and the Ethereum blockchain is also well placed to lead DeFi forward over the coming years.

Institutional investment in tokens is also rising, which makes the suite of tools that KeyFi has created look even more attractive. It is extremely difficult to create the kind of passive returns that staking offers in the established financial markets, which makes a hunt for yield in the DeFi sector a very probable market trend.

While some crypto users want anonymity, institutional investors want transparency, regulatory compliance, and safety in the markets.

DeFi does a lot to remove counterparty risk from the crypto equation (no dealing with centralized exchanges), and the identity tools that KeyFi developed removes the risk of an institutional investor working with bad actors.

There are clear advantages to attracting institutional investors to the DeFi markets, especially given the timeframe that larger funds often invest with.

KeyFi’s tools make it easy for investors of all sizes to effectively deploy capital into the existing DeFi markets, and as crypto regulations improve in both clarity and efficiency, the platform it has created may become extremely popular with institutional investors, and larger funds that want to take advantage of a financial system without a manipulated interest rate-setting mechanism.

Stay up-to-date with all of the new innovations from KeyFi with the SelfKey Twitter, and be sure to check out the SelfKey Wallet. It may well be the toolset that unlocks the natural synergy between DeFi and CeFi!



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Nicholas Say was born in Ann Arbor, Michigan. He has traveled extensively, lived in Uruguay for many years, and currently resides in the Far East. His writing can be found all over the web, with special emphasis placed on realistic development, and the next generation of human technology. Contact Nick@blockonomi.com

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