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Trezor Asks Users to Verify their Wallet Details

The details of the owner of a Trezor wallet will be automatically shared.

Hardware wallet company Trezor will have customer verification checks from now on.

New Trezor Policy and its Details

The company announced that it is integrating the Address Ownership Proof Protocol (AOPP) created by 21 Analytics. AOPP abides by the Travel Rule of the Financial Action Task Force (FATF).

Therefore, AOPP requires a user to verify the proof of ownership of a wallet address before withdrawals and deposits can be made on non-custodial wallets.

Henceforward, through this integration, Trezor will also comply with the Travel Rule.

Trezor provided the logic for this integration.

“Not supporting AOPP will lead to helping the government to fence people on exchanges, and our motivation to add direct support was exactly to keep the government from doing so.”

Trezor’s statement

AOPP automatically shares the identity of crypto wallet owners when they transact on a regulated exchange in Switzerland.

The protocol was designed to improve compliance with the Anti-Money Laundering regulations primarily of Switzerland and the Netherlands, but it also caters to the global market by complying with the Travel Rule.

“Switzerland has some extra harsh regulations when it comes to the ‘Travel Rule,’ and FINMA was always at the forefront implementing everything the FATF publishes very quickly. So we have the Travel Rule actually being enforced here,” 21 Analytics CEO Lucas Betschart said in an interview cited in a CoinDesk report.

Source: AOPP

Some of the wallets integrated with AOPP are shown above.

Implications of the Integration

An important question that needs to be answered is how will the existing Trezor users be affected.

Another issue is the huge security risk involved in the integration. Recently, it was reported that someone hacked Trezor wallet to recover $2 million lost by retrieving the keys.

After getting to know this, Trezor released a statement explaining that the vulnerability has been fixed.

But it does not mean that it becomes impregnable. The technology is not perfect. If a person steals a Trezor wallet and hacks it to retrieve the keys, they can misuse someone else’s identity.

Moreover, these are private entities that can misuse the data. The same reason was ironically given by Trezor in an earlier article titled ‘Buy bitcoin without KYC’.

Some netizens expressed their discontentment regarding this decision.

This decision could also hurt the sales of Trezor.

Change of Heart

After receiving immense flak for its decision, later on Friday, Trezor reconsidered its decision and withdrew from the integration. In its statement, Trezor mentioned that it had been discussing AOPP integration on the forum for the past one year with no opposition. Taking into account the recent feedback, the company decided to remove AOPP.

Globally, regulators and crypto industry stakeholders are at odds. Regulators allege that cryptocurrency undermines their ability to run an economy. Crypto stakeholders counter this with the argument that every transaction on the blockchain can be verified. Both may have to make some concessions and find a common ground so that regulations can be formulated. Otherwise, the industry will keep on treading on an uncertain path and will not harness its full potential.

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