Author here. A "KYC Selfie" is a selfie photo where you hold-up a State-issued photo-identity document next to your face. This is not a US-specific thing; it's also used in the EU.

I used to work for a bank in Europe where we used KYC seflies for authentication of customers opening new accounts (or recovering accounts from lost credentials), including European customers. Most KYC Selfies are taken with a passport (where all the information is on one-side), but if your ID has data on both sides then the entity asking you for the KYC seflie may require you to take two photos: showing both sides.

Some countries in the EU have cryptographic authentication with eIDs. The example I linked-to in the article is Estonia, who has made auth-by-State-issued-private-key mandatory for over a decade. Currently MEPs are deciding on an eID standard, which is targeting making eIDs a requirement for all EU Member States by 2016.

I recommend the Please Identify Yourself! talk at 37c3 about the state of eID legislation as of Dec 2023 (and how to learn from India, who did eID horribly wrong):

• https://media.ccc.de/v/37c3-12004-please_identify_yourself