Neobank Cogni has revealed that it will be providing soulbound nonfungible tokens with Know Your Customer (KYC) data to owners of its cryptocurrency wallet. The Polygon-based NFT will move the bank’s “Web2” KYC account opening verification of consumers into a Web3 environment.
In January, Cogni unveiled its noncustodial multichain crypto wallet, which is covered by the United States Federal Deposit Insurance Corporation through a conventional New York bank. In the wallet, users are able to send, receive, and store cryptocurrencies and NFTs. Optionally, users can mint the non-transferable soulbound NFT, which decentralized applications (DApps) can then decrypt with the owner’s permission.
The bank intends to create an enhanced user experience, as Cogni founder and CEO Archie Ravishankar stated. He explained that the reason why the crypto-curious have yet to be able to embrace decentralization fully is due to the poor user experience and lack of trust in the ecosystem.
According to Ravishankar, digital banking is familiar to everyone. He also mentioned that the crypto wallet is easily accessible during the regular banking process.
The NFT will contain “bank-level” KYC information that meets the United States KYC regulations and will be readily available to partner DApps without any manual intervention. Cogni anticipates creating a marketplace of DApps that can be connected with minimal effort, including KYC verification.
A rise in the use of non-custodial wallets has been determined since the crypto winter bankruptcies of key crypto firms trapped customer funds in custodial wallets. Initially, only a restricted number of users will have access to the Cogni soulbound NFT, with plans to offer it to the general public later in the summer. This means that the NFT will not be available to everyone right away but will be gradually rolled out to a wider audience over time.