Hypermine

Web -3 compliance

Leading Crypto Companies able to reduce compliance related risks by up to 35%

Enhancing KYC, AML, and Fraud Prevention.

50%'

Reduction in Verification costs for Students, universites & Business

50%'

Reduction in Verification costs for Students, universites & Business

60%

Faster Document Verification and Processing time

60%

Faster Document Verification and Processing time

30%

Increase in Global Trust and Recognition University's Reputation

30%

Increase in Global Trust and Recognition University's Reputation

Person with hand in Phone which is secure from threats

Executive Summary

The RWA Launchpad, which facilitates real-world asset (RWA) investment for crypto users, was facing critical challenges: struggling to adapt to evolving regulations, managing sensitive PII securely, proving the source of investor crypto funds, and dealing with the inefficiency and high cost of fragmented compliance vendors.

The Challenge

The RWA Launchpad platform, a key player in the digital asset space, faced several critical challenges in managing the compliance and verification processes associated with onboarding crypto investors and partners. As the platform facilitated the legal introduction of real-world assets (RWAs) to crypto investors, the need to address these challenges became more urgent:

Adapting to Evolving Regulations:

Adapting to Evolving Regulations:

Managing PII and Data Protection Compliance

Managing PII and Data Protection Compliance

Identifying the Source of Crypto Funds

Identifying the Source of Crypto Funds

Lack of Transaction Transparency

Lack of Transaction Transparency

Fragmented Vendor Solutions

Fragmented Vendor Solutions

Adapting to Evolving Regulations:

The cryptocurrency and blockchain landscape is subject to frequent changes in regulatory requirements. For an RWA platform that deals with significant amounts of investment and transactions, staying compliant with both local and international laws is vital. The platform was struggling to quickly adjust to new regulations, making it difficult to generate timely and accurate compliance reports for the government and regulators.

Managing PII and Data Protection Compliance

One of the most pressing concerns for any platform handling sensitive information like crypto funds and personal user details is the secure management of Personally Identifiable Information (PII). The platform was required to store and process vast amounts of PII in compliance with stringent global data protection laws (e.g., GDPR, DPDP). The challenge was not just storing this information securely but also ensuring that users had control over their data access, thus maintaining transparency and building trust with investors.

Identifying the Source of Crypto Funds

The platform needed an effective way to trace and verify the source of funds for retail investors. In the crypto world, it is often difficult to track the origins of digital assets due to the pseudonymous nature of transactions. Without a solid mechanism for assessing and verifying the legitimacy of funds, the platform was at risk of facilitating money laundering or other illicit activities. This lack of transparency and inability to identify suspicious activity posed a significant threat to the platform's credibility and long-term sustainability.

Lack of Transaction Transparency

A significant issue for the platform was the difficulty in extracting meaningful user information from transactions or wallets. Without sufficient tracking mechanisms in place, the platform could not accurately link wallet activity to individual users, which further hindered the ability to detect fraudulent or suspicious behavior. This opacity also made it challenging to ensure a reliable audit trail, which is essential for regulatory compliance and ensuring the integrity of the platform

Fragmented Vendor Solutions

Previously, the platform relied on multiple third-party vendors for different aspects of the compliance process, including KYC checks, AML screenings, wallet monitoring, and reporting. This reliance on several vendors led to inefficiencies, higher operational costs, and a lack of integration between different compliance functions. Managing multiple providers also made it difficult to ensure that all compliance activities were synchronized and aligned with regulatory requirements, ultimately increasing the risk of gaps in the compliance process

Solution

To address these issues, the RWA Launchpad adopted Hypersign's comprehensive solution for KYC, AML, and compliance management:

1. Flexible KYC Widget

The Flexible KYC Widget allowed the platform to capture various data points like biometrics, national IDs, passports, wallet information, and business details based on regulatory needs. This flexibility ensured the platform could bind wallet information with KYC details, which is essential for generating compliant reports for government submission, avoiding issues with verification and regulatory acceptance.

2. Encrypted Data Vault (EDV)

Hypersign’s Encrypted Data Vault (EDV) allowed the platform to securely store PII while giving users full control over their data access. This ensured compliance with data protection laws while maintaining user privacy.

3. Transaction Monitoring System

A monitoring system was implemented to track wallet behavior and generate a risk score per transaction. This system helped identify the source of funds, providing insights into retail investors' crypto activities and helping to prevent money laundering and fraud.

4. AI-Powered Data Scraping

Hypersign integrated AI models that scraped user data from public databases (such as OFAC, FATF, etc.) and matched it with transaction or wallet information. This enabled the platform to identify suspicious behavior and validate the legitimacy of users and funds.

5. Fully Integrated Compliance Solution

By consolidating KYC, AML, KYB, liveliness checks, sanction list/PEP checks, and compliance reporting into a single solution, Hypersign provided a fully integrated lifecycle management system. This helped eliminate the need for multiple vendors and streamlined the platform’s compliance processes.

Impact Delivered

To address these issues, the RWA Launchpad adopted Hypersign's comprehensive solution for KYC, AML, and compliance management:

1. Reduced Risk of Compliance Penalties

By implementing Hypersign’s integrated compliance solution, the platform minimized the risk of regulatory fines by approximately 70%. This was achieved through automated compliance reporting and adherence to evolving global regulations, enhancing the platform's reputation as a trusted entity among both regulators and users.

2. Enhanced User Trust:

The platform's transparent and secure handling of Personally Identifiable Information (PII), coupled with AI-driven transaction monitoring, increased user confidence, leading to a 40% improvement in user retention rates. Users appreciated the platform's commitment to data privacy and fraud prevention.

3. Fraud Reduction

The implementation of AI-powered monitoring systems and risk scoring significantly reduced fraudulent activities. By identifying and flagging suspicious transactions in real-time, the platform decreased fraudulent transactions by approximately 60%, safeguarding both users and the platform's integrity.

4. Cost Savings

Consolidating compliance and monitoring functions into a single solution led to significant cost savings. The platform achieved a 50% reduction in compliance-related operational expenses, allowing for more efficient resource allocation and improved scalability.

Conclusion

The RWA Launchpad platform successfully implemented Hypersign’s integrated KYC/AML solution, allowing it to address its regulatory and compliance challenges effectively. By linking user PII per transaction, tracking the source of crypto funds, and generating tailored compliance reports, the platform was able to ensure a more secure, compliant, and user-friendly experience. The flexible KYC widget, monitoring system, and AI-driven data matching provided the tools necessary to mitigate fraud and improve the transparency of transactions.

With Hypersign’s solution, the platform can confidently navigate the complex landscape of regulatory compliance while ensuring its long-term sustainability in the rapidly evolving crypto space.

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