I believe whenever feasible there should be a privacy alternative offered to KYC.
The way PayPal is able to do ‘instant’ bank transfers (i.e. spend from a linked bank account) is by having a linked credit card authorize a security hold, while PayPal pays for the purchase out-of-pocket. Once the bank transfer has completed successfully, the hold is released.
full explanation here (the PayPal Moderator’s post).
An analogous system can be used to effectively secure chargeback-able transfers. The buyer simply submits a BTC security deposit equal to the purchased amount of BTC (prior to performing the transfer), which will get refunded after a certain time period. This time period may be determined by algorithm, based on (1) the buyer’s history, (2) the payment method’s statistics - i.e. its historical time periods for chargebacks, and (3) the seller’s accepted level of risk.
A buyer may avoid this deposit by using one of the available means of reputation or identity verification, if he is able to do so.
People who live with their relatives do not have a utility bill in their name. Also all people do not have a social media, or had time or interest for such a thing. To me, making social media a requirement to use bitcoin would be sad.
KYC is a slippery slope. Yes it has a purpose. It also feeds an entire industry of people paid to circumvent it. And I believe there is almost always a viable alternative.
I hope bisq will continue to allow sellers to manage their own risk if they desire, i.e. accept buyers w/o identification, the way Paxful does currently (though this may be changing).
One way sellers on Paxful do this is by lowering their offer rate (of bitcoin per payment value) to offset their statistical risk of chargebacks.
This is another viable alternative to kyc. It avoids the need for an equal security deposit, as the seller is able to profit over the long term based on their known ratio of good customers. He is able to compete with kyc-requiring sellers by serving a larger market. If the seller finds he is unable to maintain a profitable ratio or protect himself legally, then he can adopt one or more of the verification systems/options, and let someone better-equipped take a go at it.
anyway those are my thoughts