How AI Can Speed Up Crypto Onboarding

Current User Onboarding Challenges

User onboarding is often a major pain point for crypto companies. The verification processes tend to be time-consuming, frustrating, and insecure. This leads to high abandonment rates during signup or lack of account activation.

The most common challenges include:

• Time-consuming manual verification - Requiring users to upload documents and wait for human review adds friction. This lengthy process leads many users to simply abandon signups or never activate their account after the document approval.
• High abandonment rates - In crypto, it's estimated over 80% of users fail to complete signup. The more cumbersome the onboarding, the higher the dropout rate. This costs companies significant missed opportunities.
• Security and compliance issues - Manual verification leaves openings for fraud, money laundering, and non-compliance. Humans can miss signs of suspicious behavior or fake documents. Doing the bare minimum also risks fines for non-compliance.

There is major room for improvement in how crypto companies onboard users. Legacy methods are no longer sufficient as crypto expands mainstream. This is where AI solutions can help.

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AI Solutions for Onboarding

AI and automation can significantly improve and streamline the user onboarding process for crypto companies. Here are some of the main ways AI can be applied:

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Automated Identity Verification

Verifying user identities is crucial to comply with KYC and AML regulations. AI can automate the identity verification process through:

• Document authentication - AI can scan ID documents like passports and driver's licenses to validate their authenticity. This prevents fraud from fake IDs.
• Facial recognition - Users can take a selfie which is matched against their ID photo for an additional layer of verification.
• Data checks - Public records and data from identity documents can be compared to flag any potential inconsistencies.

Automated identity checks drastically reduce manual verification time and provide a smoother onboarding experience.

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Customized Onboarding Journeys

AI allows onboarding to be tailored to each user based on data points like location, language, device, or risk profile. This enables a personalized onboarding that only shows relevant information to each user. Customization improves onboarding completion rates.

By leveraging AI and automation, crypto companies can significantly optimize and enhance their user onboarding process. This provides a smoother onboarding journey and reduces drop-offs.

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Identity Verification with AI

Identity verification is a critical part of the onboarding process for crypto companies. Financial services require a high level of security and regulatory compliance, which means verifying user identities thoroughly. AI can streamline identity verification in the following ways:

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Facial Recognition

Facial recognition algorithms can match a user's selfie to their government ID photo to validate their identity. This prevents fraud from stolen identities or fake accounts. The AI checks facial landmarks and features to determine if the photos match.

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Document Authentication

AI can scan a user's ID, driver's license or passport to authenticate it. The tool looks for security features in the ID, matches the information to outside databases, and checks for signs of forgery or doctoring. This prevents users from uploading manipulated IDs.

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Background Checks

AI tools can run background checks by aggregating data from public records, watchlists, and credit reports. This can flag potential risks with new users. The AI cross-references information like names, addresses, and birth dates to find matches across databases and compare it to information provided by the user.

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Risk Scoring

AI can assess a risk score of each user based on the results of the identity verification steps. Such solution is faster and more precise than a traditional risk scoring method. High-risk users may require further screening. Lower risk users can be fast-tracked through onboarding. The risk-scoring models are based on the pre-defined criteria specific to your business needs and can be updated easily.

Overall, AI automation makes identity verification more efficient and accurate. Crypto companies can onboard legitimate users faster while maintaining security.

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Onboarding Success

AI unlocks immense potential for improving user experience during crypto onboarding. Companies that leverage AI will be able to onboard users faster, keep them engaged, and convert more signups into active platform users. This directly impacts business metrics like customer acquisition cost and lifetime value. AI is a must-have for crypto companies looking to scale while providing delightful onboarding experiences.

Dotfile leverages AI for document analysis, AML checks, real-time feedback, and guardrails to speed up user onboarding and provide seamless experience. Businesses can benefit from intelligent approval suggestions based on automated case analysis to accelerate account opening. Book a demo to see how we can help you.