Tony Peccatiello first saw the potential of blockchain technology years ago, but something still wasn’t quite clear to him. How could the problem of identity, onboarding and anti-money laundering (AML) prevention be solved?
Parallel Markets, an identity and financial services company with more than 75 financial institutions, was the “lightbulb moment,” CEO Peccatiello told CoinDesk.
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“Every broker-dealer [and] every crypto group has effectively rebuilt the same onboarding process over and over again,” Peccatiello said. “They collect the same information, they do the same validations. That’s just bizarre.”
The New York City-based company wants to change the traditional on- and off-ramp onboarding model by cutting out the need for customers to independently input the same information at different institutions again and again. The firm caters to both traditional firms and crypto organizations.
Parallel operates as an authenticator between two parties. Those parties, whether a traditional firm or crypto-based organization, need some way to verify a person’s background.
The company has two offerings. The first is “identity underwriting,” which validates the identity of a potential user by pulling key data about them for AML and KYC (know your customer) requirement compliance. For crypto-native firms, identity can be validated using Parallel’s PID identity token, a full on-chain token that preserves anonymity. The tool also provides sanction monitoring for both individuals and business entities globally.
Parallel’s second offering is “expression of identity,” which gives individuals the option of “sharing the minimum amount of information with the counterparty” on a permissioned basis. For crypto-based platforms, users can use the PID token for expression of identity. Permission is held by the token holder and can only be released if the person chooses to share certain markers of their identity.
“There are a lot of Web3 companies that still onboard people in a very Web2 manner, but we knew if we could build software to sell to our partners then we could get paid to grow the network,” he said.
Peccatiello believes the company is well-positioned for long-term growth. In February, Parallel raised upwards of $7 million in a Series A funding round, which was led by Union Square Ventures and included Comcast Ventures and Lux Capital, among others.
“As there are more people leveraging tokens or verifiable credentials, we get paid and so do investors,” Peccatiello said.
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