Binance To Debut Soulbound Token For ID Verification
- Binance, the world’s biggest cryptocurrency exchange, has confirmed the launch of a new crypto token as a part of its regulatory compliance policy and illicit activity prevention efforts
- The first-ever Soulbound token (SBT) on BNB Smart Chain has been named Binance Account Bound (BAB) and is aimed to verify user status
The world’s biggest crypto exchange platform, Binance, has yet again marked a solid milestone in its regulatory compliance and illicit activity prevention efforts.
On Monday, Binance announced the launch of its first-ever Soulbound token (SBT) on BNB Smart Chain, Binance Account Bound (BAB), which aimed to certify verified user status on the exchange platform.
The primary goal behind opting for a decentralized identity tool BAB token is to address identity issues in the decentralized society (DeSoc). In contrast to the traditional cryptocurrencies, the BAB token is a type of Soulbound Tokens (SBT) that will exclusively be used for online identification purposes. Notably, the non-transferable, non-financialized token, SBT, is a Web3 concept introduced by Ethereum founder Vitalik Buterin, Puja Ohlhaver, and Eric Glen Weyl.
The announcement reveals that the exchange has planned several use cases for the BAB token in the DeSoc. However, it will initially serve as Know Your Customer (KYC) user credentials.
The token is currently launched as a pilot project with accessibility only on the Binance mobile app. It would allow KYCed Binance users to mint BAB on their wallets, and the BAB display on a user wallet would indicate that the wallet owner has passed KYC verification on the exchange.
BAB token can also be used by third-party protocols for multiple purposes like avoiding bots, voting, airdropping NFTs, etc. Moreover, Binance has hinted at bringing more types of BAB tokens in the future as DeSoc use cases evolve.
“This will transform how we connect, as blockchain technology will give society greater authority to determine how communities interact based on their credentials or affiliations,”Binance founder and CEO Changpeng Zhao commented on the launch.
CZ went on to add that his exchange has planned to collaborate with the community to “develop the revolutionary vision of decentralized society” by exploring new use cases for the BAB token.
The launch of the token comes at a time when several reports claimed that Binance has lost up to 90% of its customers after adopting obligatory KYC verification in August last year. However, the massive surge in trading volume in comparison to other exchange giants tells a different story.