Polygon is currently implementing stricter customer information for all potential collaborations for legal entities resident in India as the country’s regulatory scrutiny increases.
According to an individual with valid information on the matter, the Layer 2 (L2) side chain now demands thorough Know Your Customer (KYC) information. He explained that Polygon is now enforcing this for all possible investments, grants, funding, or financial assistance to Indian partners.
Polygon is Ramping Up KYC Standards For Forthcoming Collaborations
The Indian market is getting more involved in cryptocurrency and blockchain technology each day. However, various government agencies also have their unique perception of cryptocurrency, which they’re primarily rigid about.
Most government officials in India view cryptocurrency as a massive ocean of value and an excellent window for taxing. Sandeep Nailwal, one of the most influential entrepreneurs in India but resident in Dubai, stated this.
Nailwal explained that, as several government bodies are now involved in the rising crypto market, none of them is focused on truly understanding the concept of cryptocurrency. Therefore, the Indian government needs a universal knowledge of cryptocurrency.
The Polygon Cryptocurrency
Otherwise known as the “Internet of Blockchains” for Ethereum, Polygon is a Layer 2 side chain that provides a platform for connecting and scaling with other blockchains.
It offers a network where users can communicate and interact with different blockchains faster and cheaper than Ethereum. Polygon uses the MATIC native token for utility, governance, and facilitating payments.
Polygon’s Stand On India’s KYC Standards
Polygon, which runs on the Ethereum blockchain, has been implementing strict KYC follow-ups in seeking extreme compliance with Indian regulators. According to the source, the side chain will not provide any funding or financial support to any individual or legal entity that doesn’t offer their complete KYC information.
In addition, the person explained that this shouldn’t be a difficult task for those who are legitimate. Thus, they should carry on and provide their KYC documents and details.
Indian and Indian-based developers have been complaining about how hard it has been to access funding, partnerships, or investments from Polygon. The situation even got to the extent of the Layer 2 side-chain not funding projects in India, as stated by another source.
On the other hand, the source explained that this cease of funding isn’t because of Polygon’s strictness but in sheer compliance with government regulations and increased scrutiny.
The Indian government has been executing stringent regulations and taxes on cryptocurrencies. Some regulations are rigid crypto taxes and do not support the crypto industry following the decline in the crypto market due to the crypto tax.
Also, it terminated payment processors from nationwide crypto exchanges following the unstable deployment smaller-scale deployment of the crypto exchange Coinbase.
India’s fed government attacks have several effects on the cryptocurrency industry, and Polygon is only complying with them. First, the blockchain is doing this to avoid being kicked out of the country by unfriendly agencies.
Featured image from Unsplash.com, charts from TradingView.com, Arcane Research