Coinbase, a leading US-based crypto trading platform, has introduced Verified Pools to enhance security and transparency in DeFi, requiring all participants to complete KYC.
Designing a Solution to the DeFi Security Problem
Liqudity pools are fundamental to DeFi platforms, allowing users to exchange digital commodities without intermediaries. However, the anonymity of liquidity providers raises security concerns. Coinbase's solution is to require KYC for participation, reducing risks for users.
Base and Uniswap v4
Verified Pools are supported on Coinbase's Ethereum-compatible network, Base, and integrate with Uniswap v4. This enables advanced smart contract functionality and customizable trading features. Coinbase collaborates with Gauntlet to improve the health and liquidity of these pools.
User Control and Accessibility
A key feature of Verified Pools is their non-custodial nature, giving users full control over their assets. Access is provided through Coinbase Prime Onchain Wallet, Coinbase Wallet, or any third-party wallet with Coinbase verification. The service is currently available in several regions, including the US, Singapore, and the Netherlands.
Coinbase's introduction of Verified Pools enhances security and regulatory compliance in DeFi trading, lowering counterparty risks through KYC verification. Additionally, Coinbase's 24/7 Bitcoin and Ethereum futures trading expands available options for traders.
