Coinbase CEO hints its new layer-2 network could include AML measures
Coinbase CEO Brian Armstrong has hinted that the agency’s new layer-2 blockchain community Base could also be subjected to transaction monitoring and Anti-Cash Laundering measures at launch.
In an interview with Joe Weisenthal on Bloomberg Radio on March 6, Armstrong acknowledged that Base has some centralized parts at this time, including that “will probably be an increasing number of decentralized over time.”
Nevertheless, he then steered that there can be transaction monitoring and AML necessities for customers of the brand new layer-2 community.
He steered that Coinbase may have a duty when it comes to transaction monitoring within the early days, including:
“I feel that the centralized actors are those which can be in all probability going to have essentially the most duty to keep away from cash laundering points and having transaction monitoring packages and issues like that.”
Armstrong’s feedback had been additionally highlighted up by decentralization advocate Chris Blec in a Twitter submit on March 7.
Odd Heaps @TheStalwart instantly requested @coinbase CEO @brian_armstrong how CB will navigate KYC/AML obligations on @BuildOnBase.
Armstrong faucet danced round a solution. Within the final 10 seconds he hints there WILL be some kind of KYC at launch.
Want Joe had pressed for extra readability. pic.twitter.com/Q4TBV5MbS0
— Chris Blec (@ChrisBlec) March 6, 2023
Base is an Ethereum layer-2 community that provides a safe, low-cost, developer-friendly manner for customers to construct decentralized apps, in keeping with Coinbase.
It’s being developed with the “OP Stack” utilized by Optimism, which is able to allow high-speed transactions on Ethereum. Base was unveiled on Feb. 23 and is presently within the testnet section. Coinbase has but to supply a mainnet launch date however it’s anticipated in Q2, 2023.
1/ We’re excited to announce @BuildOnBase.
Base is an Ethereum L2 that provides a safe, low-cost, developer-friendly manner for anybody, wherever, to construct decentralized apps.
Our aim with Base is to make onchain the following on-line and onboard 1B+ customers into the cryptoeconomy. pic.twitter.com/RmwZFJzGGs
— Coinbase (@coinbase) February 23, 2023
Blec beforehand warned about Coinbase’s newest layer-2 providing in a blog post launched in late February, 5 days after the agency introduced Base.
He stated that layer-2 infrastructure was fairly centralized as a result of they use “sequencers,” that are “nodes that assemble and execute L2 blocks whereas transmitting customers’ actions from L2 to L1.”
Coinbase, a licensed cash transmitter, can be working the only sequencer for Base. This raised the query of whether or not Base would additionally legally require Know Your Buyer (KYC) necessities, making it the first-ever L2 to take action.
Associated: L2 is essential to Ethereum decentralization, censorship resistance, says researcher
Coinbase hasn’t confirmed or denied whether or not Base could be implementing KYC and AML measures. Blec commented:
“Isn’t it ironic that ‘DeFi’ is heading towards being managed by the entities that it was initially purported to be battling?”
Nevertheless, the crypto group and Ethereum advocates have stated Base was a “large confidence vote” for Ethereum.
Cointelegraph reached out to Coinbase for remark however had not obtained a response by the point of publication.