Design Objective

Objective 2 - Regulatory compliance

Compliance with regulations is a key objective of the KYC process; the Money Laundering Act (MLA), GDPR, and electronic Identification, Authentication, and Trust Services (eIDAS) are particularly relevant regulations for a digital KYC process.

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design-knowledge/kyc-framework-ssi-do2

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Producer label: Objective 2
Source paper: Designing a Framework for Digital KYC Processes Built on Blockchain-Based Self-Sovereign Identity
Timestamp: 2026-08-05T00:00:00+00:00
Bundle path: design-knowledge/kyc-framework-ssi-do2.md

bankingdesign-objectiveidentity-ssikyckyc-framework-ssiverifiable-credentials

Design objective Objective 2: Regulatory compliance

Compliance with regulations is a key objective of the KYC process; derived from the overall goal of avoiding money laundering, it is one of the main reasons why the KYC process exists at all. The Money Laundering Act (MLA), GDPR, and electronic Identification, Authentication, and Trust Services (eIDAS) are particularly relevant regulations for a digital KYC process.

Source paper

This design objective is proposed by Designing a Framework for Digital KYC Processes Built on Blockchain-Based Self-Sovereign Identity (Vincent Schlatt, Johannes Sedlmeir, Simon Feulner, Nils Urbach, 2022).

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3 Design Requirements

design-knowledge/kyc-framework-ssi-r2-1

R2.1 - Money Laundering Act (MLA)

The Money Laundering Act (MLA) provides banks with specific requirements regarding the identification of customers and the storage of their records, and requires banks to determine and document customer risk.

bankingdesign-requirementidentity-ssikyc+2

design-knowledge/kyc-framework-ssi-r2-2

R2.2 - GDPR

The GDPR applies to the processing of any data regarding natural persons and poses requirements such as privacy by design, portability, the right to erasure, transparency, purpose limitation, data minimization, accuracy, storage limitation, information integrity, and confidentiality.

bankingdesign-requirementidentity-ssikyc+2

design-knowledge/kyc-framework-ssi-r2-3

R2.3 - eIDAS

eIDAS imposes requirements on electronic means of identification, such as compliance with certain security levels (level of assurance) and the cross-border interoperability of systems.

bankingdesign-requirementidentity-ssikyc+2

1 Paper

papers/kyc-framework-ssi

Designing a Framework for Digital KYC Processes Built on Blockchain-Based Self-Sovereign Identity

The paper derives six design objectives (16 sub-requirements) for an SSI-based eKYC framework and demonstrates how blockchain-based self-sovereign identity can solve KYC challenges without violating data-protection regulation, deriving three nascent design principles that theorize blockchain's role for SSI: use blockchain only for public data, anticipate an ecosystem of various ledgers, and enable decentralization at the edge.

bankingblockchaindesign-science-researchidentity-ssi+3

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Designing a Framework for Digital KYC Processes Built on Blockchain-Based Self-Sovereign Identity
Paper
Source
Objective 2 - Regulatory compliance
Target
Designing a Framework for Digital KYC Processes Built on Blockchain-Based Self-Sovereign Identity
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Designing a Framework for Digital KYC Processes Built on Blockchain-Based Self-Sovereign Identity
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Resolved
Derived heading context: Source paper

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{
  "type": "design-objective",
  "title": "Objective 2 - Regulatory compliance",
  "description": "Compliance with regulations is a key objective of the KYC process; the Money Laundering Act (MLA), GDPR, and electronic Identification, Authentication, and Trust Services (eIDAS) are particularly relevant regulations for a digital KYC process.",
  "resource": "https://doi.org/10.1016/j.im.2021.103553",
  "source_paper": "Designing a Framework for Digital KYC Processes Built on Blockchain-Based Self-Sovereign Identity",
  "label": "Objective 2",
  "tags": [
    "kyc-framework-ssi",
    "design-objective",
    "identity-ssi",
    "kyc",
    "banking",
    "verifiable-credentials"
  ]
}