One of the most headache-inducing issues for crypto users is the contradiction between privacy and compliance. Either they are forced to submit ID cards and facial data, or they simply give up on large transactions and cross-chain functionalities — until recently, when a well-known DeFi project launched a layered privacy-preserving KYC mechanism, it became clear that this dilemma can actually be cleverly resolved.

Traditional DeFi projects take a very blunt approach: either enforce KYC for all functions, collecting all identity information at once; or have no verification at all, which can lead to compliance risks when handling large transactions, cross-chain operations, or interfacing with off-chain payment systems. The core logic of this new solution is to precisely match functional permissions with verification levels —

Basic operations with zero barriers. Want to use slisBNB for liquidity mining? Participate in community proposals? No need to submit any personal information, just jump in. This offers a truly DeFi experience for ordinary users.

Slightly advanced features require lightweight verification. For example, large cross-chain transfers, integration of lisUSD with CBDC payment systems — these risk management-related operations only need identity desensitization verification completed through distributed nodes. The key point is: users’ credential information is never uploaded to the project’s centralized servers; the verification process is completed within a distributed architecture.

Only institutional-level collaborations trigger full verification. In special scenarios involving large-scale institutional cooperation or exchange launches, strict compliant KYC procedures are required. This approach protects the project’s compliance bottom line while minimizing the collection of personal user data.

The most considerate detail is data autonomy. All verification information is stored locally in encrypted form, and users can delete their verification records at any time — truly allowing users to control their own privacy. Compared to the data black box of traditional financial institutions, this transparency and user control are the core charms of DeFi.

This design hits the real pain points of crypto users. It’s not about advanced technical innovation, but a sincere response to the fundamental demand of “enjoying the convenience of new finance without giving up privacy.”