Coconut is a privacy sensitive solution for the implementation of KYC in blockchain. Financial organizations, including those in the blockchain industry, should comply with KYC regulations while providing services to their customers. As one of the major features of blockchain is that all transaction records are public, transparent and permanent, there are concerns that organizations could potentially track and analyze customer behavior on blockchain once they have implemented KYC. This will raise serious privacy issues and obstruct the spread of blockchain. Coconut is a privacy sensitive solution for the implementation of KYC in blockchain. Coconut adopts Enhanced Privacy ID(Intel® EPID) to authenticate identity. It isolates the identity authentication entity from the actual business entity, allowing for identity data and business data to be managed in different organizations. Coconut protects user privacy fully, while meeting KYC requirements. Coconut finds the balance between privacy protection and regulatory compliance.