The Know Your Customer (KYC) process is utilized by financial institutions, businesses, and banks to authenticate the identities of their clients. Traditional KYC methods are often repetitive, centralized, and highly susceptible to data breaches, causing frustration for users and increased costs for institutions. Numerous studies have proposed various solutions to these issues, such as storing user data on the blockchain. However, this approach incurs high transaction costs. An alternative is to store user information on the InterPlanetary File System (IPFS) and save the corresponding hash on the blockchain. Although this method reduces costs, it leaves data accessible to anyone with the hash. To address this problem, we propose encrypting the user data with the AES algorithm before storing it on IPFS. The encrypted data’s hash is then given to the user and recorded on the blockchain. This approach creates a decentralized and secure KYC system, reducing redundancy, enhancing user control, and strengthening data security.