TransUnion and Spring Labs, a security firm, have collaborated to allow blockchain companies to view personal credit data using the latter’s ky0x Digital Passport. It enables better-informed, privacy-preserving DeFi and Web3 applications. The collaboration has unlocked a new world of authorized and reputation-based products and features.
Moreover, it will let consumers get better interest rates when borrowing from lenders that operate on public blockchains, like Ethereum. John Sun, the CEO of Spring Labs said they want to foster greater trust in DeFi products and services. As such, they came up with a tool suite that makes available off-chain reputation data on blockchain that preserves the user’s privacy and anonymity.
Sun highlighted that with TransUnion’s identity and credit data, they have the first building block to bring reputation on-chain. This will help create a more efficient DeFi lending environment that can offer better loans, more available liquidity and speed adoption in the space. Spring Labs pointed out that the ky0x Digital Passport warrants any smart contract to access off-chain identity and agreement information.
The company claims to have created a system that allows users to control their data while, at the same time, preserving their privacy. Users can give permission for their credit information to be attached to their wallets. Spring Labs said users don’t have to give up their identity when affirming their reputation and credit history to DeFi services.
The partnership between TransUnion and Spring Labs follows Credit Suisse and FinTech FQX’s announcement to provide funds to two Swiss manufacturing companies through eNote. It is a blockchain-based short-term debt instrument.