Binance Smart Chain has partnered with Ontology, a high performance, open source blockchain specializing in digital identity and data, in adopting its Decentralized Identity (DeID) for Security Tokenization Offering (STO) Projects.
The Ontology public chain released by the Ontology ecosystem works as a distributed identity trust platform that empowers the entire Ontology ecosystem with a complete range of identity solutions, including ONT ID, account authorization, authentication, and audit systems.
ONT ID is a new framework based on Ontology’s decentralized and distributed identification protocol. Characterized by decentralization, self-sovereignty of data, privacy protection, security, and convenience, ONT ID provides any entity, including an individual, an enterprise or an object, with a digital identity generated by cryptographic techniques. This digital identity is based on Ontology’s blockchain technology and is independent from any centralized bodies, which makes it safe and reliable and enables the users to take control of their identities. On the Ontology blockchain, an entity can be linked to multiple identifiers that are not inter-connected in any sense.
ONT Trust Anchor Gateway (TAG) is an open and decentralized authentication platform based on ONT ID and the Ontology trust ecosystem. It provides KYC (Know Your Customer) services for people, finances, things, and affairs. The Ontology trust ecosystem has gathered trust anchors that provide global identity authentication services, including IdentityMind, CFCA, SenseTime, Shufti Pro, etc., with email, mobile, and social media authentication methods available.
As far as the compliance requirements for STO projects are concerned, it mainly involves issues such as qualification confirmation for qualified investors, the qualification validity period, and cross-regional (cross-border) sales of security products as per regulations set forth by the United States and the European Union. The standard STO process includes the issuance plan, compliance self-inspection, issuance declaration, market fundraising, and exchange listing; and the process involves a number of entities, such as project issuers, technological platforms responsible for issuance, token trading platforms and investors.
By integrating the Ontology ONT ID system and adopting ONT TAG, Binance Smart Chain can easily identify the participants of the STO process and provide them with asset authentication.
2. TAG Plan
Ontology Global Identity Trust Anchor (ONT TA) is a comprehensive global identity trust source for Ontology Trust Ecosystem. TAs can verify and validate passports, driver's licenses, ID card OCR certification, and issue corresponding verifiable credentials to citizens of 200+ countries around the world. They provide multi-dimensional and high-accuracy identity authentication services for consumers. The Ontology trust ecosystem has gathered trust anchors that provide global identity authentication services, supporting email, mobile, and social media authentication methods.
Credential Template Name
Global user passport authentication
Global user ID authentication
Global user license authentication
Global user passport authentication
Global user ID authentication
How does ONT TAG work?
- A0: ONT TAG provides a public authentication service marketplace. A credential consumer can browse and select their desired Trust Anchor and the authentication service they need on the ONT TAG platform.
- A1: After the credential consumer confirms the authentication service, they need to register certain basic information on the ONT TAG platform. This information includes the ONT ID of the requester, a basic introduction of the credential consumer, and a callback address.
- A2: The credential consumer submits the user data (from their end users) to the Trust Anchor Source via ONT TAG based on the requirements of the specific Trust Anchor.
- A3.1 - A3.2: Trust Anchor authenticates the user data uploaded by the credential consumer and issues a verifiable credential which will be recorded on the blockchain. A transaction follows.
- A4: After the Trust Anchor issues the verifiable credential, the encrypted public key of the ONT ID corresponding to the verifiable credential user will be sent to ONT TAG.
- A5 - A6: ONT TAG pushes the verifiable credential to the end user directly, and the SDK on the user end sends the credential to the credential consumer based on the callback address.
- A7: The credential consumer can verify the credential status on Ontology mainnet.
3. STO Solution of Binance Smart Chain
Technically, it is easy to integrate the ONT ID framework with Binance Smart Chain to implement a STO solution that uses ONT ID to meet the requirement of investor qualification
- uses ONT ID to verify the qualification of qualified investors during validity period;
- creates contracts with the smart contract mechanism of Binance Smart Chain for cross-regional sales of security products;
- enables relationship binding between the investor qualification, the investor and the security tokens by integrating the address-based wallet verification from Binance Smart Chain to ONT ID.
The STO solution of Binance Smart Chain fulfills the following requirements,
- To satisfy the basic compliant requirement of standard STO in processes like entity authentication and KYC;
- To bring out partially fungible security tokens, and satisfy the requirement in the STO issuing process and the entire life cycle of security tokens.
- To satisfy the requirements of two major categories: entity authentication and KYC, and securities tokens. Technically speaking, the interface is integrated with technical components from ONT ID and Binance Smart Chain infrastructure.
The Binance Smart Chain-Ontology STO solution ensures regulatory compliance in different geographical regions via the ONT ID framework, enabling STO projects to complete STO market fundraising based on the technical issuing platform built on the Binance Smart Chain infrastructure, and implement exchange listing via the technical protocol automatically.
4. ONT TAG KYC Access Plan and Demonstration
4.1 KYC Tenant Registration of Distributed Identity
The project team logs into the Ontology Addon store (https://store.dev.ont.io/) to create a distributed KYC application. The following preparation needs to be carried out:
Install the mobile application Ontology Authenticator or ONTO, and register and ONT ID or import the ONT ID of the project team;
The wallet linked to the ONT ID needs to hold at least 100 ONG for contract deployment and transaction fee payment (Ontology can be contacted to pay the fees on user’s behalf).
After creating the KYC application, the project team downloads the corresponding SDK and configuration files:
The downloading should be performed after the KYC application is created and deployed to the mainnet;
The information in sdk.initialize should be modified according to the configuration files.
Video 1: https://youtu.be/nuAnNjanM8g
4.2 KYC Integration of Distributed Identity
To meet KYC requirements, an ONT ID for the user can be generated using the SDK and the information provided by the user can be authenticated. If a user passes the authentication process, a verifiable credential will be issued for the respective ONT ID.
The authentication request will lead the user to the Ontology identity authentication interface (The interface can be customized to meet the user’s needs, and supports HTML5 Hybrid mobile app).
The authentication process is as follows:
Enter the identity information along with photo ID, and submit an identity authentication request. For specific KYC requirements, the ONT ID-VC system can be connected to services like liveness detection. Please contact the business personnel in case of such requirements;
The process of decentralized identity authentication needs to generate ONT ID on the user terminal and save the issued verifiable credential.
To authenticate the verifiable credentials, Ontology provides TS SDK and mobile terminal SDK that can be integrated into any third-party user terminal. The three-party user terminal needs to support the storage of the user's ONT ID and verifiable credentials;
Ontology provides ‘Cyano wallet’, a chrome plug-in that supports Chrome browser, and provides ONTO on mobile;
The user submits the relevant information to the credential issuing organization via the TAG, and the issuing organization authenticates the user information. If the identity authentication is successful, the ONT ID will receive the corresponding credential.
Video 2: https://youtu.be/2Efv7PVv_Wk
4.3 Integration of Wallet Verification
Ontology verifiable credentials support the binding of wallets on various chains to a single ONT ID by issuing the proof of wallet relationship to the ONT ID.
The process of binding a wallet to the ONT ID involves a decentralized solution, which requires the generation of ONT ID and proof of wallet relationship at the user end.
.The user sends the relationship proof from the wallet to their ONT ID to form an authentication. If the authentication succeeds, the ONT ID will receive the corresponding credential.
Video 3: https://youtu.be/jHN_CDR9T6A
This article gives a brief introduction of Ontology’s decentralized identity framework (ONT ID) and the Ontology trust anchor gateway (TAG), and shares a Security Token Offering (STO) solution based on the integration of Binance Smart Chain and ONT ID.
This article also contains a simple demo on how to combine Ontology TAG with Binance Smart Chain wallet(s).
Ontology is a high performance, open source blockchain specializing in digital identity and data. Ontology's unique infrastructure supports robust cross-chain collaboration and Layer 2 scalability, offering businesses the flexibility to design a blockchain that suits their needs. With a suite of decentralized identity and data sharing protocols to enhance speed, security, and trust, Ontology’s features include ONT ID, a mobile digital ID application and DID used throughout the ecosystem, and DDXF, a decentralized data exchange, and collaboration framework.