Crypto users reject dYdX promotion necessitating a face scan

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Several members of the cryptocurrency community have rejected the verification process set up by the decentralized exchange dYdX during the registration process. On Wednesday, dYdX announced that new users who deposit 500 USDC coins for their first transaction will receive a USDC 25 promotion if they complete a “vitality check”.

Crypto users refuse the dYdX registration process

The exchange said the verification process would involve logging into the user’s webcam and comparing if the image was used to create another account on the DEX. The promotional giveaway was voluntary, and many people on Twitter had implied that the move was an invasion of privacy.

DeFi Watch founder Chris Blec has accused the DEX to manipulate its users by giving them bribes for their faces to be scanned and masked by a promotion showing that dYdX and other exchanges could provide better incentives for their customers to forgo more information.

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Blec claimed that dYdX’s actions were wrong and were misleading users intentionally. They said every face scan they collected was from an innocent person. Also, a criminal shouldn’t go through the scan, but can still use the dYdX exchange.

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dYdX also reported that after looking at multiple solutions, the face scans provided a solution that provided the best UI to show they were the same person without revealing their full identity.

Also Polygon’s chief legal officer, who previously held the role of chief legal officer of dYdX She said that these checks were incomplete and ineffective without combining the other requirements. However, Blec also said the exchange could have acted on behalf of regulators or could be a testing mechanism that would be expanded in the future.

Cinneamhain ventures’ general partner, Adam Cochran, also opposed the move, saying it was “an absolutely horrible idea”. Cochran said there was no reason to collect users’ biometric data.

Displacement not foreseen by the regulation

Despite speculation that the regulations might have made the move necessary, a spokesperson for exchange dYdX said the verification had nothing to do with the regulations.

The spokesperson said the move was an easy way to detect if you were a unique person. However, the platform did not outline the service for which it would use the facial scans and how the data in question would be stored.

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