Bitcoin Forum

Currently, most of the exchanges (CEX) are KYC required. As we all know, most of the crypto currencies (especially bitcoin) are decentralized and anonymous.

Why should those exchanges collect our personal information? Do you think KYC is necessary?

I'm doing a research, and made a survey, so can anyone be interested in this topic share your opinion? Thanks.

Here is the survey link: https://forms.gle/rMeMZf7S1jo8bMwt5 (https://forms.gle/rMeMZf7S1jo8bMwt5)

That's where you're wrong buddy. It's actually the reverse. Pretty much all cryptocurrencies(yes, even Ethereum) besides bitcoin is centralized, and probably 99% or more of cryptocurrencies are only pseudonymous.

If you ask me, of course I wouldn't want to submit KYC. But the fact is, most governments of these countries that these exchanges operate on requires KYC. It's not like most of them require KYC just because they want to; most of them are just following the government requirements.

I agree with you that you do not need to kyc on trusted sites to exchange crypto those who use anonymous sites and introduce kyc in case of scams there is not much need to provide kyc documents in cryptocurrency exchanges. It is better to stay away from the sites that make kyc compulsory they try to hack into personal information the number of scams has increased due to the growing demand for crypto so most traders do not trust kyc exchange sites..

Some exchanges didn't require any KYC from the start but like mk4 said the rules have changed now that the exchanges are monitored by the government. As much as I hate KYC it's becoming a necessary at this point since it's a matter of having a better trading experience or your money getting released if the exchange just updated their rules. It's always better to avoid KYC but it's impossible when most of them forces you to provide KYC right away.

it depends on the type of the exchange.
i have no issue with submitting KYC with a fiat related exchange where you deposit your fiat to buy bitcoin for example. because that is a fiat related issue that has to also affect bitcoin exchange too.
but if it is an altcoin exchange where you trade altcoins versus bitcoin then there simply is no reason to ask for KYC at all.

there is also the issue with weak security of exchanges and their shadiness that adds a certain risk level with submitting your personal information that can easily leak or be sold on darknet!

I had already answered your survey, and some questions should've had a middle question, not just yes or no. For example, the question "will you trade on the platform if KYC is required?" it depends on the exchange's reputation, etc. Your data that will have gathered will have more flexibility and a realistic approach. It should have an "Other" option then remarks on it.

Many of the exchanges require KYC, but some don't like binance without kyc already being able to trade. But KYC is very necessary to maintain security For example, when you lose 2FA, KYC accounts will be easy to handle

It depends a lot by the exchange's profile.
If the exchange works with fiat, the legislation asks it to collect KYC info. If it doesn't it's an illegal business.
If the exchange doesn't work with fiat, I think that it can work without KYC in many countries (?).

Many point to Binance as example. I think that they've somehow avoided the law by using 3rd party operators (afaik) for their fiat operations. It's a solution, but I don't know how long it'll work. Binance also asks for KYC if people want their debit cards or big transfers.

The real problem is that there are so many exchanges (and other businesses!) asking for KYC although they can live without it (and some "businesses" only exist as long as they can get KYC details they can sell!).
Another real problem is that many people give out their KYC without thinking much, sometimes only to get a few dollars (or cents!) worth of tokens. Or enroll to all (big or small) exchanges (with KYC) without thinking twice. At some point one will be sloppy (or with bad intentions) and problems will happen.

Lol, you are right. I made a mistake. Only BTC isn't under the ctrl of someone like the founder Nakamoto Satoshi, and no one knows who is him.

Who said all cryptocurrencies are anonymous and decentralized? Get your facts right!

Exchanges will require the KYC details because they are legal business entity. They have a base of operation and they have to abide the law of that country. KYC details is an integral part of any financial service you want to take around the world. So these exchanges have no choice other than asking for your KYC details.

Bitcoin and other cryptocurrencies are just a financial instrument for these exchanges. But the exchanges are mostly governed by the regulatory agencies!

The exchanges collect our information because KYC policies are required by the authorities,so all the crypto trading platforms and their customers have to abide by the law.
I think that KYC policies are helping for fighting money laundering and illegal financial activities.KYC policies aren't perfect,but if there was no KYC,the cases of money laundering,financial crimes and scams would be way more.I'm not talking only about the crypto industry.I'm talking about the fiat financial system as well.

that is only a very small part of it not all. the real reason why bitcoin is considered decentralized (while many others aren't) is 100k+ full nodes coming from all around the world, lots of miners that also come from all around the world, the algorithm being PoW that provides more decentralization specially with this high difficulty and spread of miners compared to something else like PoS, no premine, no fundraising scam such as ICO, forks (aka upgrades) that have always gone through only after reaching supermajority support, decentralized development from lots of contributors, ...

When cryptocurrencies was just in the start of their way and wasn't quite as popular almost all of the exchanges did not require KYC but now almost all of the centralized exchanges require KYC at some point, maybe if you are trading in smaller amount you wouldn't need to do KYC but for bigger amounts you definitely need to complete KYC verification, that is the main reason behind the increasing popularity of Uniswap and other platforms like that.


Some of them need KYC information because of their government requirements and otherwise they wouldn't be able to continue working there and some other exchanges need users to pass KYC so that they simply can sell those information on black market, those information that people provide them with aren't cheap either since I believe there is a good demand for such information.

Yeap. Even though chances are that Satoshi has a crap ton of bitcoin, not even Satoshi Nakamoto himself has control over the Bitcoin network. No sole entity has; and that's what Bitcoin has over every single altcoin in existence.

Can you be more specific about your thought here. I want to be enlightened. Why and how are they centralized?

Well, opening an exchange is not as easy has you thought. You need to follow strictly the regulations. Otherwise, you will be banned from operating your business in your locale. Therefore, providing KYC is obligatory. However, there are still exchange that are decentralized and P2P. You can try them if you want to avoid giving your identity

1. Ethereum has far less nodes compared to Bitcoin simply due to the multi-terrabyte space required to run an Ethereum node.
2. Ethereum in it's entirety is pretty much just Vitalik Buterin + Consensys. There's a reason why Satoshi Nakamoto left the project early on, and that's to spread out the development and to remove biases from him.
3. The reversal of the Ethereum DAO hack. That itself is a red flag.
4. Don't even get me started on other altcoins as they're FAR worse. Pretty much just single teams having control over the entire networks.

I'm not particularly a heavy trader, so I've never really needed to provide KYC whenever I trade, I mostly do my trades in Binance and so far no prompts about needing KYC were required for me to do so. Still, If I were prompted to give KYC to every single site I would need to use, I'd rather not to. I mean, who wouldn't prioritize not giving their personal info to others right? But if rightfully needed, I suppose I wouldn't have qualms about it. I personally don't want to, but if it's a requirement, I'm down for it.
The Law. A requirement of sorts, is it necessary? In my eyes probably no, but they look at the perspective of anything that could happen kind of thing. An exchange may host hacked coins so having KYC for users could easily help in pinpointing that. Iirc, the recent twitter scam was traced due to the scammers sending coins towards exchanges then withdrawing them without even going through mixers. Might not be the entire story, but I'm pretty sure it's close.

Actually, it depends on the exchange because some of the exchange does not require you to input your personal information, even me I don't want KYC because there are a lot of fake websites that really looks so real and when you input your personal information then something bad may happen on you. your account may be hacked or they may use your personal information for their personal purposes but sad to say we need KYC before we login into specific website, we cant do things about it because they are just following the governments.

It's because exchanges fall on the category of VASP (Virtual Asset Service Providers) and as such as FATF
exchanges needs it's costumer's KYC to be fully compliant.

So for majority this pose a serious problems because obviously, we don't want our personal data to be subjected to this exchanges are there are also history of leaked KYC in the past.

I am not taking your servey but answered on the poll.I fyou ask is this necessary to provide KYC documents for centralized exchanges then I will say yes because for a company to get approval on a country they need to follow certain regulations so they have mo other choice to follow them.

But as a user they can decide whether they want to give documents or going to use decentralized exchanges so they can maintain their anonymity even while trading as well.

Because these exchanges are centralized they have to give the reports to the authority so while Bitcoins are decentralized the platform we are trading them are centralized and Bitcoins are not meant to be anonymous in my opinion it is just one property of being decentralized currency.

Because like I said they need to pay taxes on the gross income and they have to make sure there are no fraudulent traders and things like stolen funds or money laundering is not going on through their exchange.

I think doing KYC actually makes us strong because imagine if the exchange tries to scam we at least have our ID verified and clear from our side to file a claim.

I think it's more personal...
I have no problem doing KYC as long as that on trusted exchanges like Binance, Probit, Bittrex, and others. Trusted exchanges will definitely keep secrets from consumers, in contrast to new exchanges which mostly impose KYC only for their future benefits.

This is an important issue. Traders who trade with small amount they do not have to do KYC on most exchanges, they can withdraw 2 BTC per day without KYC. I used a lot of exchanges without KYC, because I traded in those exchanges with small funds so I didn't need to do KYC anymore.

The exchanges will ask you to KYC only when you can make large trades, because there can be illegal activities when funds of large amount are traded. And centralized exchanges sometimes think of themselves as banks, so they confuse traders by adding any kind of rules at any time.

Firstly, I'll choose an exchange who has been used by most people, like binance or OKEx I'll no doubt giving my personal identity to use the exchange. They will responsible for all the bad things that will happen and also they will make high security to protect it and so far I trust them to protect my personal identity. And second, seem like there is no exchange especially those who operate and have legalized in my country who don't ask KYC, all of them will ask a new user to give their personal identity to use the exchange. Besides that, I'll never give my personal identity especially for new exchange or unknown exchange who offer a lot of promotion.

If we don't have other option then we will be force to submit our KYC just to use a better service of exchange and to lessen the risk that we will end up to those scam exchanges.
But frankly speaking, in my end I really hate KYC but I don't have other option because there is only one local exchange that is available in our country and there is no easier way to cashin and cashout via it.

My major problem with the current centralized kyc model is the risk it exposes people to. Your valuable private data could be hacked, abuse, misused, etc by those who have access to them. Imagine the risk you will be exposed to if your home address, your phone number, date of birth and other private information is access by dangerous people.

I think people should trade without kyc, but if kyc become necessary, a decentralized kyc system should be used instead. With this, everyone controls his/her private data, verification is done by the network in a crypto-friendly manner and verified information is hashed and used for authentications.

If there are no other options, I don't think KYC will be a problem when it is a trusted exchange like Binance.
Binance requires its users to verify KYC in order to access many of its new features and make larger withdrawals. Some people are not happy doing KYC, but KYC is very necessary to verify our identity. The platform selected must also be a platform that can truly be trusted to store your personal information. There is nothing wrong with doing KYC, but you have to be careful. Don't submit personal identities to foreign platforms you don't know.

I think most exchanges that require KYC are obeying the rules of the country that they operate. KYC isn't wrong if data is kept as secret from even government but that is not possible since the government is having interest in the KYC.

I voted yes as I have done several KYC and will still be open to doing more but here's the catch, my documents used for this verification are all fake including that of Binance and Luno that I use actively for all my transaction including withdraw to fiat. Yes this document has my passport on them but all other details are fake including my names. Now I'm not much of a centralized peer2peer patronizer since I have fallen to scam in my early days in the industry. In a scenario when this document gets rejected which has happened before, I abstain from using that particular platform.

I see no reason why my details are been needed by this platforms, the only reason why they have my passport is because some verification needs additional proof where I'll be required to send a selfie, assuming that wasn't needed, I would had proceed to using these fake documents in accessing all the KYC needed account.

In my opinion it depends on the size of your deposit or personal trading, and Binance and other trusted exchanges imposing kyc on a certain portion of the asset is very appropriate.

I would not say kyc is a must for traders as long as it is can be avoided no matter how difficult it is (legally) and the slightest chance even though the exchange has their responsibility to the local government regarding the identity of the customer. But if the kyc request is related to personal risks using CEX such as locked accounts, withdrawal limitations, and so on (big risk), I will still do it forced and there is no other way on the condition that their kyc system is up to standard, not corrupted and has been tested. Here is an example of a bad KYC system that I have done my own research (https://bitcointalk.org/index.php?topic=5256384).

In so far as I have been trading on CEX, I have only sent kyc once on an exchange where I have exchanged my crypto to fiat. And I have regretted it after I found out that some members of this forum have crypto to fiat exchange services.

I am one of those who disagree with cryptocurrency exchanges to have KYC, because there is a possibility that the exchanges
could sell their user data. I always use exchanges that do not require users to perform KYC procedures, because for me personal
data is important and valuable. The only exchanges that I am willing to do KYC procedures are local exchanges originating from
my country, I did that so I could cashout.

I don't want to provide, TBH.

There are a lot of decentralized exchanges, proven and tested. It is just that, I am using an exchange that requires KYC because it is more efficient since I could make that exchange as a middleman to some transactions that I wanted to. It is a mobile exchange so I could pay some bills, buy load or buy some in-game currencies if I wanted to.

I already made a mistake before, when I have funds trapped in an exchange. Because before, when I started to sign up on that exchange, there were no KYC things at all, but after few months, they updated their Terms of Services and their new update is to submit KYC before you can withdraw your funds, so I have no choice, that's why I submitted KYC documents. Even I don't want to, I don't have choice.

Today, many major cryptocurrency exchanges are introducing appropriate measures to implement KYC policies. This is an established policy, thus the exchanges reject all suspicions from the government authorities. On the other hand, exchanges that do not require KYC from customers are subject to risks and all sorts of legal claims. The presence of verification serves as a kind of guarantee that the exchange does not engage in dark machinations.
As for the clients themselves, this is their choice. There are many options for registering on exchanges today. Providing personal information on reputable exchanges is quite normal.
Moreover, as much as we care about the confidentiality of our data, today, unfortunately, it becomes increasingly difficult to achieve this. The only thing that depends on us is to more carefully choose the places where we leave information about ourselves.

Some government need some stringent rules to guide against shady deals like money laundry by some Exchanges both centralized or decentralized ones in order to trace or track such fraudulent transaction KYC is mandated for some customers that usually transacts with huge amount of coins, transferring huge funds can be well suspicious thus requires proper monitoring to know maybe it will fall into the wrong hands particularly terrorist organizations terrorist are looking for various avenues to fund for their nefarious activities therefore there is a need to checkmate these exchanges.

Though, the world of cryptocurrency is full of individuals with different motives which involve their ways of handling their respective personal data. Some have their privacy important with them why others don't, so, back to your question: the choice is yours if you want to give out KYC or not. Personally, i don't give out my personal information for any reason becasue my dignity depends on my privacy online and offline.

Crypto has many exchange sites but not all exchange sites need to provide KYC documents later. These are new techniques to scam sites that ask you to kyc trying to hack ID by stealing our personal information. cryptocurrency is better not to use kyc exchange sites for your own protection as there is no possibility of leaking our personal information. I can exchange KYC very securely on other sites.

Always a matter of principle mixed with practicality for me. If I lived alone and only had myself, I'd be doing P2P all the way, and little to no KYC.

As it stands, I actually don't live alone, and have many many co-dependants, and because of my current residency situation, I would very much like to set my affairs in place so as to make it easy for living conditions and all that. Hence, my decision to KYC at a couple of exchanges. A necessary evil, but it makes things just so much easier and predictable.

I would try my best not to give KYC details to any exchange and I would rather find alternative ways to do the exchange.
But if there is no other way around to perform the particular transaction then I will not hesitate to give the KYC details.
This is because of 2 main reasons

1. I am not doing anything wrong and so I would not be afraid to do any transaction
2. I would be using the best reputable and safest platform to whom I would be giving the KYC details.

Despite these reasons if there's something unfortunate that happens then I will be prepared for it.

Forgery of government issued documents is a serious offense, punishable as a felony in most (if not all) countries in the world. This is not something I would brag about on the forum, especially if it potentially encourages others to commit a similar criminal offense.

True, sending your actual IDs can be risky and dangerous, but if you don't trust a particular service or organization, the only thing I can recommend is - don't use them.

True and so are VPN yet they're still been used and recommended even after it has been banned by obviously the government that are non friendly to Bitcoin and cryptocurrencies in general. What I illustrated above isn't something I am proud of but it just had to be done and I'll redo them if I was to start all over especially as the exchange services this days aren't concerned about our privacy and take advantage of any opportunities they have to get hold of our personal/sensitive information and auction them to the highest bidder or pass them down to the authority.

I didn't think I'll ever trust any service provider to the extent of sending them my personal details as far the industry is concern so your statement becomes absolute, and I won't advice any individual to do the same (and if I might have mistakenly pass the impression of supporting such in the past, disregard that statement).

I had no idea that using VPNs was illegal somewhere. That's really stupid. VPN is just a tool and tools aren't inherently good or evil - it's how we use them that matters.

Now, as I read about it, I see that there are a handful of countries that have actually banned VPNs. For example: Belarus, China, Iraq, North Korea, Oman, Russia ... I am really lucky that I do not live in such countries.

In fact, many exchanges have implemented KYC procedures because they are forced to follow government regulations. If exchanges
does not enforce KYC, the exchanges will not legalize, and after all, they will enforce KYC in order to convert crypto to fiat. Actually
I have no problem doing KYC by providing the personal data that I have as long as the exchanges are trusted. After all, all of us who are
accustomed to transactions using banks must also do KYC. So now when using exchanges to do KYC there should be no problem.

For prohibiting money laundering, asking the personal documents, and proving the ownership is required because of the age limit. It is the same in the gambling world, the suspicious activity on exchange and price manipulation will be easier if there was no KYC. Well-known exchanges have the right to request KYC and I will not hesitate to send it in order to continue using the crypto exchange. Maybe multi-accounting or using the same IP address due to VPN-proxy services can cause this but having a verified account is always the best choice.

Every CEX exchange are expected to implement KYC/AML but Bitcoin is only decentralized and not anonymous cause it was pseudonymous.

That's because they operate under the rules and regulations giving to them by SEC or their license provider.

If you want to make use of CEX exchange site? Yes, KYC is necessary.

^ We have nothing to do just to accept the fact.
KYC now is a part of a licensed exchange that everyone would know about it through your post. But I like the move of Binance, having their own rules that implemented and the none KYC verification. Nevertheless, just follow what they mentioned above, it's quite useless.

I voted Yes in the pool. I know that KYC/AML is heavily frown at here in crypto due to the fact that it tampers with people's privacies (privacy is one of the reasons people get on board the crypto bandwagon). However, providing KYC still has it own benefit. For one, you can retrieve your exchange account if you lost access to it - like losing your phone, PC crash etc. In such a situation, all you have to do is to provide the same ID docs and if it matches, you'll be given access back into your account. This and other benefits which I won't mention.

For the records, I'm not a fan of KYCs either but I participate in the exercise when it becomes a necessity.

How can any country Ban the VPN ? VPN are avaible on the net and you can use them and no govt. authority will be able to know that you are using VPN. This ban is just like crypto currencies ban which cannot be enforced.

For the KYC in  cryptocurrency exchanges, we don't have much options. Either do the KYC or don't trade.  :(

Before, KYC was not actually a requirement on some exchanges. I have first experienced filling up for KYC verification on the times of bounty campaigns where bounty managers as well as the team developers of the project do wanted to ensure that the people they will be paying with is a real person having real identity. At first, that looks strange knowing that we are working anonymously using usernames to work in the forum then this KYC get through initializing a transparency when it comes to identity which the exchanges do adapt in order to secure its customers having a safe place to work with.

Now that because the government of a certain country wanted to ensure its people's welfare not to get into a scam exchange, KYC verification process is now being a requirement to be able to secure that people are really true and for security purposes. If it is not intended, I will not do the KYC process but since it is a requirement nowadays, then there is no choice but just to follow for why worry if you are having a clear intention on doing transactions.

Back in the past where KYC isnt really that too mandated yet crypto isnt really making some noise back then and when the market had become saturated and get involved with
lots of scams and frauds then government had already recognized its existence not only to this matter but also in taxation purpose as well and even on money laundering issue.
Nowadays there are platforms that do offer tx on maximum of 2btc per day which is sufficient but for people who do goes above that limit then there
would be no other options but to abide on whats being asked out.

You're right but you don't need kyc to trade on Binance. It is when you need to withdraw to fiat instead of wallet address you are required to submit your documents for KYC. Or when you are to withdraw a large sum of Bitcoin. But KYC helps most CEXs to trace scam wallets, like the person who hacked Kucoin, if he had user CEX wallet who he/she submitted KYC. It would be easy to be traced and apprehend along the accomplices.