Fractal Digital Identity Integration: Bringing KYC/AML to the XRP Ledger Ecosystem

As the web3 developer experience continues to evolve, so too does the need for better KYC/AML processes and protocols. The XRP Ledger community is soon to add an exciting new partner, Fractal ID, that will integrate with the open-source blockchain to provide digital identity technology. Fractal is a leading provider of digital identity technology that enables compliance processes like KYC and AML. This integration will enable participants in the XRPL ecosystem to onboard and move seamlessly across dApps, leading to a better experience for all developers and their end users.

The XRP Ledger is an open-source, energy efficient, and decentralized blockchain powered by a global developer community. Many developers have created dApps and businesses on the XRPL over the years, leveraging core features like fast finality and low transaction costs. Advanced features including an order book DEX, protocol native NFT functionality, token access controls, and more, have enabled the developer community to thrive in scaling their user base and on-chain activities.

Fractal’s digital identity technology will provide further enhancements for the developer community by enabling them to offer compliant tokens and services. This will also improve the user experience by reducing the number of times a user must onboard (just once), and their compliant digital identity is then ready to move seamlessly between dApps. The XRPL thus becomes a more user friendly web3 experience.

How Does Fractal Off-chain Registry Technology Work?

An off-chain registry is employed in a privacy focused manner to facilitate user verification. The registry maintains a list of verified wallet addresses containing specific KYC requirements to provide businesses with a seamless onboarding experience, while ensuring user privacy and security. For dApp developers running their on-chain business, this off-chain registry enables seamless identity verification.

The off-chain registry is secure, and dApps can offer their users an expedient onboarding process that adheres to all pertinent identification requirements. The end user links their wallet to the registry to verify their identity. Their credentials are then communicated to the dApp without compromising their privacy. This verification method provides an uninterrupted and dependable experience to facilitate a more user-friendly and decentralized Web3 ecosystem.

The User Experience Illustrated

The open off-chain registry lives up to its name by being accessible to everyone. If you're a newcomer, all you need to do is submit your identity documents, such as a passport or residency permit. After Fractal confirms the validity of your documents, you can use a dApp instantly, without having to repeat the KYC process. This method is designed to preserve the user's privacy and foster a secure web3 environment that promotes development. Additionally, since these credentials are reusable and interoperable, users who pass verification for one dApp can promptly switch to other dApps within the XRPL ecosystem.

Digital Identity is a Net Benefit for the XRPL Community

Fractal’s participation on the XRPL will ultimately enable a secure, compliant dApp ecosystem with user privacy in mind. Fractal’s collaboration with the XRPL creates a better user and developer experience by:

• Making identity verification necessary only once to enable a seamless user experience across all XRPL dApps.
• Employing an open, off-chain registry that is designed to be inclusive of all users. Both Fractal and non-Fractal users can connect and take advantage of its privacy-preserving features and functionalities.
• Fostering a regulatory-compliant ecosystem that prioritizes users’ privacy and upholds the network’s integrity while empowering users with reusable verifiable credentials and restoring control over their data ownership.

Developers can now serve more users with greater ease. With exciting features anticipated to be proposed to the XRPL such as the AMM, sidechains, and Hooks, developers can leverage Fractal’s digital identity solution across a greater number of use cases.

Learn more about coding on the XRP Ledger, or join the XRPL developers discord for further updates from the community.