AOPP Explained

Address Ownership Proof Protocol (AOPP) is a tool that allows cryptocurrency owners to prove that their self-hosted wallet (also known as an unhosted, private, non-custodial wallet) belongs to them in an easy, fast and private way.

AOPP needs to be supported by both the self-hosted wallet and the VASP to exchange the signed message used to prove ownership. In practice, AOPP automates steps every wallet is capable of performing to send information to a VASP, but only with the user’s request and approval.

Why Would a VASP Request Verification
of a Self-hosted Wallet?

For compliance purposes, VASPs must adhere to country-specific rules when transacting with self-hosted wallets as part of their AML efforts.

The Travel Rule stipulates that VASPs must identify the owner of the self-hosted wallet if at least one obliged entity is involved in the transaction. Depending on local regulations, collecting this information may be sufficient, while in other cases like Switzerland and Singapore, VASPs must verify the ownership of the self-hosted wallet.

21 Travel Rule & the AOPP Portal:
How It Works

This process can be 100% automated for the VASP. The prompts below are if the process were to be done manually.

1. In the 21 Travel Rule software, the AOPP Portal Link is to be selected.

   A pop-up will open requesting the following information:

   • the Customer ID,
   • the digital asset type.

   This information is to be completed; thereafter, Get AOPP Portal Link is to be selected.

2. Next, a pop-up will appear containing a URL to be shared with the customer to complete the ownership proof.

3. The URL will be shared with the customer via their preselected communication channel (email, iframe etc.).

   The customer will open the link and complete the ownership proof process. Once this process has been completed, the proof will automatically appear in the Compliance Dashboard. 

From a VASP Customer’s Perspective 

1. The customer (wallet owner) initiates a transaction with their VASP.

2. The customer will open the received AOPP Portal Link and select their wallet type in the AOPP Portal.

3. After selecting their wallet type, a pop-up will appear directing them to their device with further instructions on how to complete the ownership proof.

4. Once the customer has completed the ownership proof process following the prompts per their wallet, the will receive 2 confirmation messages.

   One message will appear on their wallet confirming their address is now ready for transacting.
   The second message will automatically appear in the AOPP Portal, confirming their address has been successfully registered and that they are able to transact.

What Are the Pros?

• The process is fully automated upon the wallet user’s demand,
• It is safer than the screenshot option,
• It is easier than manual signing,
• The chances of address reuse are virtually nonexistent,
• Malware attacks are minimised as there is no copying and pasting of addresses,
• It is fast; wallet ownership can be verified in seconds,
• It is Travel Rule and General Data Protection Regulation (GDPR) compliant.

What Are the Cons?

• Only some wallets support it. However, there is ongoing work on wallet support for various hardware and software wallets.