Why ThreeFold Uses Centralized KYC (for Now)
Hello ThreeFold Community,
We’ve seen questions and concerns about why ThreeFold — a decentralized project — is using centralized KYC (Know Your Customer) with an external provider. Let’s take a moment to explain why this is necessary today, and why it actually helps protect our farmers, users, and the entire ecosystem.
- Protecting the farmers
Farmers provide the physical infrastructure where workloads run. Without KYC, anyone completely anonymous could deploy workloads — including people who want to abuse the Grid for illegal purposes.
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If illegal content or activity were traced back to a farmer’s IP, the farmer could face questions from authorities.
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With KYC in place, ThreeFold can show that users on the Grid are verified humans, not untouchable anonymous actors.
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This creates a legal shield for farmers, because responsibility falls back on the verified user rather than the node operator.
- Protecting the ecosystem
Centralized KYC also helps maintain the integrity of the ThreeFold Grid and TFT economy:
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Prevents fraud, spam, and malicious actors from harming the network.
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Ensures that TFT flows are tied to real, accountable humans, keeping the system safe and sustainable.
- Why we can’t do fully decentralized KYC yet
We share the vision of decentralized identity, where users control their ID in a wallet and provide proof without sharing full personal information.
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Regulators do not yet recognize decentralized KYC solutions as sufficient.
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Using decentralized KYC alone could leave farmers exposed to legal questions if illegal activity happens on their nodes.
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Until frameworks like EU Digital Identity Wallets (eIDAS 2.0) are widely adopted, centralized KYC via a trusted provider is the safest solution for the Grid.
- The bottom line
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Centralized KYC today = legal safety + farmer protection + ecosystem integrity.
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Without it, the network could be vulnerable to abuse, and farmers could face risks.
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With it, we protect the ecosystem while moving toward a future where decentralized KYC can be recognized and implemented.
We understand concerns around privacy and decentralization — we share the same dream. For now, centralized KYC is the bridge that keeps ThreeFold safe, compliant, and sustainable.
Thank you for understanding and helping us build a secure and decentralized future together.
Sabrina on behalf of the ThreeFold Team