# Compliance

Compliance is a fundamental part of Veilnyx's transaction system, designed to prevent illicit activities and protect innocent users. 

Our Selective De-Anonymization (SeDe) network establishes regulatory standards, allowing privacy-preserving applications to trace illicit transactions without centralized control, ensuring adherence to regulations.

### Guardians and Revokers

The system includes independent guardians and revokers who manage private keys for de-anonymization in a decentralized manner. The selection of guardians and revokers can vary depending on the application.

### **De-Anonymization Scenarios:**

* Compliance checks may be activated based on specific criteria. Transactions may be de-anonymized if linked to illicit activities, while the privacy of law-abiding users remains protected throughout their Veilnyx transactions. 
* Only the revoker requesting de-anonymization can access transaction details, including user addresses.

## Two Methods of De-Anonymization

## 1. Voluntary Selective De-Anonymization (SeDe) <a href="#voluntary-selective-de-anonymization-sede" id="voluntary-selective-de-anonymization-sede"></a>

Users can demonstrate data ownership through viewing keys, which can be downloaded from the activity tab.&#x20;

This allows them to selectively de-anonymize data for third parties, such as tax agencies or legal authorities.&#x20;

This approach promotes compliance while empowering users and developers within a decentralized framework.<br>

## 2. In-Voluntary Selective De-Anonymization (SeDe) <a href="#in-voluntary-selective-de-anonymization-sede" id="in-voluntary-selective-de-anonymization-sede"></a>

Veilnyx maintains decentralization by distributing decision-making authority among multiple entities, including revokers and guardians, instead of relying on a single entity.

For more details on Veilnyx compliance, visit [here](https://arxiv.org/pdf/2311.08167).

Private keys of both revokers and guardians are used to de-anonymize a Veilnyx ecosystem's transactions in a distributed manner.

## Roles in the De-Anonymization Process

### Revoker Responsibilities

The de-anonymization process begins with a revoker submitting requests.&#x20;

Guardians safeguard against unauthorized de-anonymization, ensuring it only occurs when law enforcement presents a valid warrant or court order.&#x20;

Without this legal authorization, guardians block de-anonymization attempts, protecting user privacy.

### **Guardian’s Responsibility**

After a revoker submits a request, guardians vote on whether to de-anonymize the transaction.&#x20;

Once enough guardians approve the request, they grant cryptographic permission, enabling the revoker to proceed with de-anonymization.&#x20;

The revoker can then perform the 'Decrypt' action to access the de-anonymized transaction details, including stealth addresses and asset information.

### **Normal User Access**

Regular users, who are neither revokers nor guardians, can only view transaction history from the homepage of Decom.&#x20;

They do not have access to de-anonymized transactions.

### **Compliance actors list** <a href="#compliance-actors-list" id="compliance-actors-list"></a>

Veilnyx's decentralized compliance relies on distributing power among trusted entities, known as guardians and revokers.