AML / KYC compliance policies act as double edge swords; First, on the one hand, ICO helps to verify and validate their investor identity, document investor profiles, types of business and financial activities and finally assess potential risks for money laundering activities; keep the good side of the law.
On the other hand, the blockchain system encourages decentralized autonomy and has become the reason for many investors from various cadres who are interested in that in the first place. With privacy policies, regulations and identity verification, this potential whale is lost and causes losses in the financial resources of the ICO project concerned.
How was Digitex Futures successful without implementing KYC? |
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The KYC or AML process is now standard practice for any legitimate ICO looking to raise funds. These processes not only benefit the project implementing them but also help to protect those with interests within the project.
Even though the crypto space is largely unregulated, it doesn’t mean that we can’t behave and conduct ourselves as any normally regulated sector. It’s all of our responsibility to ensure that we protect the ICO and crypto space as stakeholders. In order to do that, ICOs and projects need to implement a KYC or AML process.
I agree, but wouldnt you say there are added risk to collecting data of users. Lets say the data gets breached; what's next? Wouldn't the company implementing the KYC/AML be held liable. Also, instead of doing kYC/AML why not just restrict the companies that require them; primarily US and China. |
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Thanks for the information everyone. Why do some ICOs restrict the US and certain territories?
Because in some territories ICOs are either illegal or legal grey areas. For example as soon as founders allow US citizens to take part in an ICO, without actively seeking out the SEC's approval or abiding its regulation, the SEC will have a close eye on them; legal problems being almost assured regardless of the founder's country of origin or operation. So would you say it's best to not allow U.S. Citizens to participate? How did Digitex Futures do their ICO and avoid scrutiny? |
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Have you heard of OST KYC? If so, what are your thoughts?
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In addition to what others have said, usually they have legal experts who they seek advise. So at the beginning there are ICO which doesn't require any KYC's but when the tokens are about to distributed, other's suddenly asking for KYC's just to make sure that they are following all regulations and they need to adapt, otherwise if might have a big implications later. Its just sad though that it was not intimated at the very beginning so that investors or bounty hunters not comfortable sharing their personal data will not invest or join that ICO project.
ARe you saying that most ICOs dont start with KYC and AML; they do it later? |
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After they established a legitimate business in their country of origin it will always depend on where they will promote and locally launch their ICOs, most of the cases (not all countries) where there have a local representative promoting their ICO on that country they will be required to exercise KYC but it always depend on the country's rules and regulation. But a lot of ICO developers are already avoiding this just by promoting their ICOs internationally where there is no governing body that will prohibit them on not requiring ICOs, just like what happened to Thailans were ICO sales and promotions are banned but it is not stopping their citizens on participating ICO sales internationally.
Is there a complete list of countries that have banned ICOs. I'm working on a sports platform and seeking which countries to blacklist. In addition, it seems like there is no way to block participants as VPNs can be used. |
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KYC / AML is a due diligence process that allows companies to verify the identity of their customers, ensure that the money they want to send is legally obtained and that the customer is not part of the sanctions list, a criminal, a terrorist, or a corrupt organization.
Why is this important? Regulators around the world are increasingly interested in ICOs. This can create uncertainty for cryptocurrency projects and their investors. Although national laws are sometimes absent or unclear, Know Your Customer (KYC) is a universal concept that is widely understood in global finance.
Voluntarily complying with KYC regulations provides many benefits to the company and its investors, even if they are not currently explicitly mandated to enforce the process.
In other words, KYC / AML is a priority to protect contributors and clients, which is why many ICO decide to implement the KYC / AML process.
Why aren't anonymous sites using KYC/AML? It seems like people are still using them. Better yet, are all ICOs requested to register the company? |
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i'm going to consult with LegalZoom. has any ICO ever used LegalZoom for ICO services on legal matters?
I tried looking for some but couldn't find any. I did find these reviews though which may be troubling lol. Either way, you need professional advice, and while you're technically not hiring a lawyer, LegalZoom can still provide it. It should be fine. I'd like to note that trying to save on legal fees might bite you in the ass later though, especially if you're starting an ICO where lots of things could potentially go wrong. Thanks for the post. Those reviews aren't good at all, so legalzoom wont be the option. I'm trying to use the most cost effective way until I'm able to get funding. Right now, everything is being done by me. After I complete the WP, and Landing page, I can then consult with legal on the best route as far as where to register, KYC, and AML. |
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i'm going to consult with LegalZoom. has any ICO ever used LegalZoom for ICO services on legal matters?
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So after implementing KYC/AML, does a business have to meet other requirements for all countries that have individuals who may participate?
Yes. KYC/AML procedures are only really for anti money laundering compliance. There may be other laws that need to be observed depending on the jurisdiction. What I mean by outsourced is there are a lot of companies that you link to your ICO website that will validate users and make sure they meet KYC/AML. Hence putting the responsibility of the user's data on them.
I don't exactly get what you're saying, but yes, a third party can do the validation for an ICO. I'm not sure if they can take sole and full responsibility of the data though. It looks like I will reach out to a crypto lawyer. |
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Greetings to all,
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Thanks for the information everyone. Why do some ICOs restrict the US and certain territories?
Because in some territories ICOs are either illegal or legal grey areas. For example as soon as founders allow US citizens to take part in an ICO, without actively seeking out the SEC's approval or abiding its regulation, the SEC will have a close eye on them; legal problems being almost assured regardless of the founder's country of origin or operation. Is there a document that has a list of countries and regulations required? |
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So with implementing KYC and AML, does this mean its safe for companies to let US and China individuals participate in their ICO?
Not in China because ICOs are banned there. They have to be registered with the SEC in the US because they're not allowed to operate there otherwise and they can only serve accredited investors. Both countries' regulations go beyond a simple requirement of KYC/AML. Should a 4rd party site be used for KYC/AML?
What do you mean? KYC/AML procedures can be outsourced to third parties, if that's what you're asking. So after implementing KYC/AML, does a business have to meet other requirements for all countries that have individuals who may participate? What I mean by outsourced is there are a lot of companies that you link to your ICO website that will validate users and make sure they meet KYC/AML. Hence putting the responsibility of the user's data on them. |
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Greetings to all,
I'm here to help you with your Cryptocurrency website whether you want it from scratch or you want to edit or redesign it, we are available to help you.
I'm having 6+ years of extensive experience in the field of designing and developing the Cryptocurrency Exchange/trading website platform.
Features:
Fully Responsive Design and User-friendly design
KYC – verification of the identity by uploading the documents
Google Authenticator (Two-Factor Authentication)
The ticket system for customer support
History of orders, transactions, deposits, withdrawals
Payment Gateway for Deposit and Withdraw functionalities
Deposit/withdrawal for both crypto’s and fiat
E-mail notifications
Core Wallets (JSON RPC)
Trading Pairs
High-Chart /Tradingview Chart for all pairs
Buy /Sell Functionalities.
Order Type (instant order, Stop order, limit order etc)
Order matching engine
Order Book
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Fast time delivery.
I will provide you with exactly what you desire.
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Do you have a demo? Yes, I have. Can we have a link to the demo. |
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For KYC/AML 4d party can be useful but it should be trusted one.  How difficult is it too b implement on a site that's already developed. |
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I believe we will have a very strong team, getting the best members of the forum. I'm already developing a new cryptomade, I wrote the white paper, and I'm developing her website, I confess I'm having a hard time finding good team members. Profissioais to compose the main team. Most interviewees do not want to receive during the sale of the token, either work and already receive, the creation of a criptomoeda takes a few hours of work, but a large project needs the commitment of a good team. The amount collected from the sale of tokens is to pay the team and reinvest in improvements and partnerships. contact mpgalloo@hotmail.comAre you looking for individuals to work for a stake in the company and not for a salary? |
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KYC is very much important in my opinion this cannot be left.
KYC is important for fraudulent ICO projects. This is unquestionable. They disappear not only with the money of investors. but also with their confidential information and copies of their passports, as well as with similar data of credulous participants in the generosity campaign ICO. In the future, and they will be able to sell this information. In the case of bounty hunters, the ICO team here is not at all entitled to require them to undergo a KYC check. No country requires this. Some countries, such as the US and China, are only worried that their citizens will not suffer material losses because of the risky investments of their funds in ICO projects. Therefore, prohibitions do not apply to persons who are not investors in ICO projects. So with implementing KYC and AML, does this mean its safe for companies to let US and China individuals participate in their ICO? Should a 4rd party site be used for KYC/AML? |
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What determines if an ICO requires KYC and AML?
Do not invest in ICOs "no one will force you to invest" unless you trust who is behind those projects. If those projects are registered and have headquarters" like banks," they will be required to know their users, but if they are not, they are trying to scam you and selling your data in the black markets. So do an in-depth search of the project, the developer team, and their personal information before sending any data. For more read, the letter addressed to the United States Senator Ron Wyden[1] or this: Generally, under existing regulations and interpretations, a developer that sells convertible virtual currency, including in the form of ICO coins or tokens, in exchange for another type of value that substitutes for currency is a money transmitter and must comply with AML/CFT requirements that apply to this type of MSB. An exchange that sells ICO coins or tokens, or exchanges them for other virtual currency, fiat currency, or other value that substitutes for currency, would typically also be a money transmitter, [1] https://coincenter.org/files/2018-03/fincen-ico-letter-march-2018-coin-center.pdfTo be safe, it looks like its best to implement KYC and AML to avoid all penalties from government. That would be my next step in the project. |
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Greetings to all,
I'm here to help you with your Cryptocurrency website whether you want it from scratch or you want to edit or redesign it, we are available to help you.
I'm having 6+ years of extensive experience in the field of designing and developing the Cryptocurrency Exchange/trading website platform.
Features:
Fully Responsive Design and User-friendly design
KYC – verification of the identity by uploading the documents
Google Authenticator (Two-Factor Authentication)
The ticket system for customer support
History of orders, transactions, deposits, withdrawals
Payment Gateway for Deposit and Withdraw functionalities
Deposit/withdrawal for both crypto’s and fiat
E-mail notifications
Core Wallets (JSON RPC)
Trading Pairs
High-Chart /Tradingview Chart for all pairs
Buy /Sell Functionalities.
Order Type (instant order, Stop order, limit order etc)
Order matching engine
Order Book
Why Me?
100% Professional & Original design.
Fast time delivery.
I will provide you with exactly what you desire.
PLEASE PING ME
Thanks
Do you have a demo? |
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