Bitcoin Forum

Well, it seems that regulations are taking the direction of controlling the exchangers' users information. Given the difficulty of controlling the cryptosystem, for it is decentralized and, somehow, anonymous, governments are choosing to introduce some new requirements into exchangers, so they can control the identity of the crypto users.
The most recent case I've noticed is the Poloniex one, for the new rules have been implemented since the last week. Now, they ask you for your real name, your place of residence, a pick of your personal official ID, your telephone number, and (the most amazing), a picture of your own face, alongside with a paper in which the date must be written.

Regulations are coming, and they can hit hard the market, I'm afraid. Today every coin in Poloniex appears in red.
So. They can't totally control the coins, but they can control the use you make of a coin.

 If exchangers become a new banking system, then, what's the point of crypto?

That's a very serious concern. Governments know that they can't control the cryptocurrencies. That is the reason why they are trying to get information about the crypto users and assess the situation to take further step. A full sized regulation is inevitable for sure where crypto users will be identified by the government and forced to comply with their own rules and regulations. But as you correctly asked, if the anonymity is gone, what is the use of crypto?

The answer is decentralized exchanges. earlier I was also a little skeptical about using a decentralized exchange, but looking at the requirements of majority of the exchanges, I think it is the best tool available for us right at this moment to fight this situation. 

I think some regulations are needed, ok. But this surveillance nightmare is going too far. As long as I provide my fiscal information, my name, and my ID, they should feel satisfied. But why your face? This is the one requirement I find scary as hell. Your face appears on your ID, but some exchanges are even asking for you to download a facial-scan program. To what end? For governments to recognize your face in any airport, street, station? What's next? A DNA sample? With which ones are they going to share this information if asked?


I'm afraid those are not going to survive for long... But, yes, we need to fight this. Orwell's 1984 wasn't supposed to become a manual.

Poloniex was acquired by Circle which is owned by a bank.
I think that they have plans in exchanging crypto for fiat in a way or another and for that KYC is a must.
At least this is what I hope to be the reason and not something obscure related to leaking user info to bankers or government. At least not yet.

Since last week? As far as I know, they said they were going to implement those new rules in Q1, as early as January. There were some warnings about this. I think it had to do with the acquisition by Circle.

Personally, I pulled my money from Poloniex when the first announcement was made (December, I think). I don't trust them or the third party they use to verify documents, and I didn't want my funds locked up over it.


I love the idea of decentralized exchanges. But how do you get USD in and out of the system?

There's things like Tether, but they've had huge banking problems, and have also been subpoenaed by the US government -- seems risky to depend on. And they require KYC for direct banking anyway.

UGH, I must have overlooked that part..
I just did mine but didn't do the paper.. It'll probably screw me..

I haven't used polo in quite a while anyway..

There are services like Localbitcoins and paxful. Make use of those services. If your volume is not significant, then these websites will not ask for your ID and verification. Maintain and low status and never do a transaction with a significant volume, that may act positively on you. There are people who are willing to do cash transaction with you without going through banking channel. Explore these services and you will have your answer. 

It wont really come to a point where exchangers can become a new banking system. Government might able to impose regulations but not totally stopping the true essence of cryptos existence.It would really give doubts specially to traders but come to think off that there are lots of exchangers in the market and implementing such regulation to be applied generally or on all exchange would takes time. For now we can avoid those exchange that do already have that kind of new regulation.

That is governments at work. It seems the only to get any manipulation to do to us is to follow the activities on exchanges. Well, let's all hope the rules and regulations dont become too much to affect our activities.

That will actually fuel Bitcoin even more as base currency. People will buy Bitcoin where they can, and trade crypto to crypto on these decentralized exchanges till they are done and start to cash out in the same way they entered.

It's also going to be interesting how atomic swaps will gain ground in the coming years. Theoretically right now it's only LTC>BTC and vice versa, but I can see it become a more global thing later on.

It will allow everyone to even bypass decentralized exchanges if deployed globally. We decide the exchange rate of the trades, where the market effect will even things out to add liquidity and fair exchange rates.

I am using few exchanges but they didn't ask me any proofs yet but we have the options that to provide our personal details to increase our withdrawal limits per day so it is not needed for a small traders like me and I never provide any details yet.But if it will be implemented in future then it may affect the trading as well because most of the people want to stay anonymous with the crypto earnings.

I have actually zero in Poloniex, and, still, they asked me for a picture of my face, alongside with all the other information.
Exchanges taking this path can become a target for hackers, but maybe the coins are no longer to be their goal, for they can hack even your face and your place of residence, your trading history and exactly know how much you have, how much money you've moved.

Besides, the fact of facial recognition still gives me shivers. I don't have any facebook account of this kind of social media, but I have friends and they post anything in their accounts, even pictures of me with my family, etc. I don't get why the picture, for the facial recognition, is unnecessary and pointless to protect people, on the contrary, this is more about surveillance.


Well done. I didn't hear of it the last December, I just received an email and my account was blocked at the same time. Fortunately, I had nothing in there.
The Circle change, yep, probably that's why.

I hope they re-examine this system because it is so irrelevant and what is the use of all of this anyway our goal is to be there just to trade and until now I still have not done that procedure to create a new account in Poloniex

You must be jumping into conclusions there mate. Government demanding Exchanges to require KYC to their users does not make them a new kind of banking system. KYC as a requirement is a simple means to avoid a lot of criminal activities, not to mentions that it is their way to verify that you are a real person, and not a robot trading into their system. We are also lucky as we are not required to physically appear in order to verify our accounts compared to some stock brokers where they require you to physically submit your documentations. We cannot have a free and unregulated market aymore, it is much more safer this way.

But they want the picture something written on it right so some random pictures won't work but still we can photoshop it but not all they are asking this photo is just to finalize that you are a real person but login with your account with the facial recognition every time is not possible.But these regulations have good side also that it can save us from hackers whatever we have to submit all the proofs if we want to continue to trade on it.

IMO, these new regulations are not so straining as they seem. These may even help reduce fictitious accounts and identities which may constitute fraud. It may be alarming for some especially for those who value their freedom with the use of crypto but these new regulations do not constrain too much its users. I would much prefer to have a secure and safe system rather than participate in a world where criminals are free to run about.

That's true. They are looking for ways to get user data and as you said, utilizing the exchange platform is one of the easiest way they can do that. I think that could also be the reason why KYC is on the rise. Anyways everyone says you're information is private and safe with us but I bet you if anything comes up and the government needs access to your data, they'll do everything they can to get it

So, in this world in which there are so many criminals, as you say, you're willing to send to a company your digitalized personal ID, as well as other personal information, as the scan of your own face?
The point is: all this information can be hacked as well!!!

But that's why banks require KYC -- they are considered financial institutions and money transmitters, so they need to comply with anti money laundering laws. Governments are beginning to treat exchanges the same way. So if people use them to store money, they're essentially banks. They know your identity, they monitor your financial transactions, they report suspicious activity to the government. They may not be lending institutions, but for our purposes as customers, they're essentially banks.

There's even a bill in the US (https://cointelegraph.com/news/us-senate-moves-to-criminalize-non-disclosure-of-cryptocurrency-ownership) -- not passed yet -- that seeks to define exchanges (and other entities including mixers) as financial institutions. If the bill is passed, exchanges will literally be considered banks.

KYC In ploniex was implemented early this year and so far no problem about the security of every user. The price is red in poloniex simply because the market is dumping. I’m using poloniex and I still believe my money and personal informatio will be safe there, hopefully.

These are basically for security purposes. Exchanges are like crypto banks with trading facilities. So they are trying to give some assurance of the coins in their care. If many exchanges adopts these trickling regulation , we are going to have further regulations in other areas of cryptocurrency like icos and scamming.

so far the stricter the regulation in every exchangers not just poloniex almost other exchange also give the same regulation maybe this to know the identity and reduce crime also fraud.

I could not have agreed more than what you have said and the only explanation is that government will continue to have its way no matter how we pretend not to acknowledge it and that is why they go after the major exchange sites. This approach is what is called Indirect Rule whereby since they cannot control crypto directly after several attempts and they cannot also ban it successfully because of the benefit that accrue from that source, then the option of focusing only the various intermediaries that makes the market flourish and those are the exchange sites, the web wallet services and gambling sites. Have these three in your pocket any form of anonymity is unravel to a large extent. I can say its a strategy that is working because there is an incentive attached to like the gains from trade, winnings from gambling, real time access to funds by the web services and that is what is needed.

Are decentralized exchanges included? I mean how are they to manage decentralized exchanges? The maintenance devs?

I think this is somehow fair enough since everyone are using a fiat currency after trading to any crypto currency and the banks are having a problem of tracing the money where it goes and where it came from, that's why they have to make a regulation because are still concern of the "money" and not the crypto currency itself.

Never been fair yet they are still trying to take control or do make transactions to be more harder due to such regulations. Government would really like to trace up on income and outgoing funds of an individula by means of exchangers. Decentralized is all we do like but how we would able to move if exchangers are the ones being used for us users to be traced on regarding on our transactions.?

I agree that some of them are urgently needed but I'm also afraid that many of them will become an issue.

Yeah you're right the government will not be able to control the cryptocurrency directly, then they try another way by giving the rules on the exchange. they know that without a exchange users will get a difficulty to perform financial transactions, then government requires the exchange site to oblige their customers to verify data such as ID cards, and self-image. surely it will make decentralization on crypto missing right? btw it has already happened in the local exchange in my country..

Such changes are very doubtful to me, not cause of I'm a cheater or something and afraid to become recovered, no. I am not sure in the security of all those exchangers and my private information can be stolen and used for who knows what. In the such case it's going to be hard to prove that I didn't do anything illegal, but my private info was used for something criminal.

So we have to stay away from those kind of exchanges because if we want to use that exchange then we have to accept all their terms.But I don't think it will be used for criminal activites,I hope these are just to save our funds from hackers who are the big threats to the crypto currency exchanges and adding more security feature will add the more security to our funds.

It can be as for protection as for counting of coming necessary taxes to the government's chest from crypto profit, like that everyone will be pushed to pay. And yes if we do not like new terms we are free to not use such exchangers, but what if all exchangers are going to be like that? What is your suggestion in that case?

This is a very good question. I think once the US and Russian have spoken and asked exchanges to ask for personal data to their users, one by one, decentralized are going to be forced to ask their users as well.
The most concerning part, under my point of view, is about the control. Exchanges are not only about selling your crypto into cash (dollar, euro, whatever) but about buying/selling alts. Crypto was made with the intention of avoiding and giving an alternative to the banking system, by being decentralized, so the legitimacy resides in the people, the users, the miners. But, if the use of the crypto is regulated, then, every transaction will need to be approved by the government, for the tool, meaning the exchange, is under its control, though.
So, I 'm afraid maybe the time with no alternative will come soon, and many crypto users are going to be obligated to share their personal data. Regarding the face-photo, I can't fully understand why are they asking for that. There's no online bank asking for this kind of images, or at least, I can recall none. They ask for your ID and your place of residence, as well as for a phone number, but I 've never been asked for a face-pick before.
That's concerning to me. Maybe I've just read too many times Orwell's 1984, but, still, I can't see the point of the need of knowing with such a detail the shape of your face...

If all the exchanges are like these then stay away from the crypto tradin if you still don't want to reveal your personal information,there is no other option other than accepting their terms but there were lots of exchanges and only few have these kind of regulations as far now so we can pick other exchanges to continue our trades.

Its like the well known app here in my country which is the one who generates my bitcoin address. Before you have given your oen address, you must first enter your name, address, birthday, a photo of your face and one valid ID. It will undergo in a process then after few days, you can now enjoy investing on BTC and ETH. Bitcoin is decentralized, but when your country becomes the third party, it eill.be centralized. Im happy for their service so far.

I sense which country you are talking about, yes in that country before you make a wallet for cryptocurrency you need first to fill up their kyc form. Stating above are those requirements need just to have on that wallet and mostly used in people there.
Just like the same now on many exchange site they are requiring personal information which is we can't hide like being anonymous person.
Time to time, whether we like it or not the world of cryptocurrency is being centralized by our own government or us as a users.

I actually don't know also, well if its a valid ID they are asking then it is already shown. Dual verification maybe?

So in the future may come where you will need to verify your self to use an exchange. Sort of like fiat money. Then bitcoin will be like fiat money with added fast features. More of like upgraded paypal?

When crypto exchange come on this world , most of their activity consider as risky investment /activity so that's why their government want to take serious act about exchange's policy.
My local exchange also do the same so it's also protect their exchange from scammer attempt !

Still, I suppose that some of the regulations are really must-have.

It may be plus point. Government is planning to make a new rule and regulations about cryptocurrency. It means, Government wants to declare cryptocurrency legally in the world simultaneously.

That's my concern too.
Besides, the "kidnap" has not been resolved yet. I don't know if it is legal to change your policies and make the users unable to say "Ey, I don't agree, so I prefer to withdraw my funds and leave the service". Nop. They restrict your funds' access as long as you don't give them the information they seek due to their change, but it is even legal? When I agree with a service term and then they change them, I am supposed to agree again, don't I? Even if I have some funds on my Paypal account I should be able to withdraw them if they change their policies...
Sad. This is sad.

This is not new pal. I did this on bittrex and binance has this kind of KYC but it is just not enforced. And of course it should be your real name because none of us would want to get in trouble or else they will keep all our funds away from us if they found out.