Panther Compliance
Compliance
TL;DR
Zone Managers determine what compliance looks like for their Zone/s
The Protocol is agnostic as to which third-party compliance provider/s integrates
The Protocol does not process user data; compliance providers do
Transactional data can only be accessed by stakeholders with the correct keys
Introduction
Considering the difficulties in developing a decentralized solution that preserves privacy and enables compliance, Panther designed an approach that utilizes three essential components: third-party compliance provider integrations, Panther zAccounts, and Zones.
By leveraging the Protocol’s Zero-Knowledge characteristics, these elements collectively form a pathway to achieve compliance.
Read about the regulatory rationale for Panther integrating compliance tools.
Panther has built a system that retains neutrality by integrating compliance providers that accept multiple types of verification. These systems are called “multi-compliance vendors,” as they allow users to choose from a variety of compliance providers while retaining a decentralized approach.
For testnet, the Panther DAO was commissioned to select a multi-compliance vendor that aligns with its interests.
Discussed in Panther’s forum.
When integrating these providers, the following requirements are taken into consideration:
Ability to blocklist Politically Exposed Persons (PEPs) or newly-flagged individuals based on unverified identities
Blocklists for Externally Owned Accounts (EOAs), i.e. wallets
Ability to create an “allowlist” to control entry to a Zone
Preferably, the ability to have an on-chain verification list maintained through oracles/smart contracts
Performing validations at deposit and withdrawal
Optionally, allowing users to register multiple addresses. This is suggested so that users can break the on-chain link between their transactions by withdrawing and depositing from different addresses.
Optionally, using a Zero-Knowledge proof to allow users to create new accounts once they have passed verification.
Panther Protocol allows compliance providers to process user data without the Protocol learning it: by proving a user’s ownership of their wallet and giving them a Zero-Knowledge proof that attests to the validity of their KYC statements. This allows users to access Panther but maintains the Protocol’s neutrality. The diagram below exemplifies this process:
What next?
Not only do the compliance providers enable Zone Managers and users to demonstrate their transactional activity to regulators, but they also give the individual zAccount holder, the user, a high degree of control over what data they reveal to whom. Learn more about user reveals.
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