As the blockchain space continues to evolve, new platforms and innovations are constantly changing the way value is created, traded and protected.
This monthly update looks at KYC for blockchain games:
Blockchain games – commonly referred to as NFT or crypto games – are video games that incorporate cryptography-based blockchain technology. Blockchain games typically use cryptocurrencies or NFTs that players can buy, sell, earn and trade with other players. These cryptocurrencies and NFTs can then be used to make in-game purchases. Blockchain games that allow players to earn native NFTs or cryptocurrencies by playing the game are known as play-to-earn or P2E.
What this all means is that blockchain games are blurring the line between gaming and finance. Using a P2E platform, users can now effectively earn or buy in-game tokens, cash them out for more liquid ERC20 tokens, which can then be sold for fiat. This system is creating a whole new host of opportunities for gamers to earn incomes from gaming – but is also creating new possibilities for criminals to launder illicit proceeds through P2E platforms.
While video game providers previously did not have to consider aspects like Anti-Money Laundering (AML) and Know Your Customer (KYC) responsibilities – as they did not offer any virtual assets – games that offer the chance to buy, earn, trade and sell in-game tokens need to comply with global AML regulations and reporting standards.
Case study: Forgotten Chain
KYC-Chain has recently partnered with Forgotten Chain, an innovative, blockchain-based gaming platform that is also offering its users the chance to earn and trade its native tokens and NFTs.
Forgotten Chain presents an impressive break from what most blockchain-based games have so far offered.
The gameplay is as complex and multilayered as is to be expected from a massively-multiplayer online role-playing game (MMORPG) in 2022, but has the added power of allowing its users to earn “Forgotten Coin” tokens through their performance in the game.
These can then be used to buy Forgotten Chain NFTs, which can be traded both within the game and out on the external NFT market.
Forgotten Chain is also issuing limited numbers of tokens for sale in private and public ICOs. In order to ensure compliance and to properly vet their prospective investors, they have opted to use KYC-Chain’s onboarding platform.
This allows Forgotten Chain to quickly and securely ascertain the identity and understand the risk profile of individuals who want to gain access to its NFTs – either through in-game earning or through its public and private ICOs. In addition to facilitating Forgotten Chain’s compliance with constantly-evolving global financial regulations, it also secures the platform against being defrauded by sham investors or malicious actors.
To find out more about the Forgotten Chain project and its ICO, check out their whitepaper here.
And if you want to find out more about how KYC-Chain can allow your blockchain gaming platform to onboard users, players and investors securely and efficiently, get in touch and we’ll be happy to start a conversation.