Coin Center’s Laz Pieper calls for a new approach to KYC data collection

KYC data has become a highly attractive target for hackers, according to a CoinDesk opinion piece centered on a proposal from Coin Center’s Laz Pieper. He argues that the way identity information is collected should change, with the focus shifting away from gathering large pools of underlying personal data. Instead, privacy-preserving identity verification systems could let individuals prove only the specific facts a service needs to know. Under that model, users would keep control of the underlying information rather than handing it over in full. The argument is that identity checks do not always require broad disclosure of sensitive records, and systems can be designed to verify limited claims while reducing the exposure created by centralized data collection. The piece frames current KYC repositories as an irresistible honeypot for attackers and presents privacy-preserving verification as an alternative that could reduce that risk while still meeting service-level identity requirements.