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Author Topic: Determinations of KYC and AML  (Read 304 times)
Yaunfitda
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August 31, 2018, 07:35:37 AM
 #41

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.

Yes, there's a big risk on investors or even bounty hunters if ever such hacks occurs:

https://www.reddit.com/r/CryptoCurrency/comments/83ybwn/shady_dadi_ico_server_got_hacked_huge_data_breach/

https://thenextweb.com/hardfork/2018/02/07/sentinel-chain-ico-leak-passport/

Of course the project or company should be held accountable because you put trust in them that they are going to secure your personal data. I guess ICO than are requiring KYC now are making it more riskier on our end.

I think some ICO's are also doing some restrictions as well. You can't join if you are amongst the country they don't allowed.

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August 31, 2018, 09:17:00 AM
 #42

What determines if an ICO requires KYC and AML?

It depends on the country that the ICO is operating from, and the citizens that it is offering its investment scheme to (that's why you see some ICOs banning certain country's citizens to participate).

While I'm not sure what the exact procedures are, most legitimate ICOs nowadays in countries with more mature crypto ICO regulations will ask you for KYC docs such as your ID, as well as AML docs, perhaps fund sources.

At the end of the day, the ICO itself is probably not even in that much control when it comes to the collection of the docs. The regulators in each country decides whether these investments are legal, what they are classified under, and what procedures are.
Would you recommend using a site such as OST KYC for this?
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August 31, 2018, 09:26:58 AM
 #43

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.

Yes, there's a big risk on investors or even bounty hunters if ever such hacks occurs:

https://www.reddit.com/r/CryptoCurrency/comments/83ybwn/shady_dadi_ico_server_got_hacked_huge_data_breach/

https://thenextweb.com/hardfork/2018/02/07/sentinel-chain-ico-leak-passport/

Of course the project or company should be held accountable because you put trust in them that they are going to secure your personal data. I guess ICO than are requiring KYC now are making it more riskier on our end.

I think some ICO's are also doing some restrictions as well. You can't join if you are amongst the country they don't allowed.
Can't the risk be mitigated by offloading the KYC to a company such as OST KYC? So far doing my research, if KYC/AML is provided, it looks like all countries can participate with the exception of China. Am I correct?
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August 31, 2018, 03:25:00 PM
 #44

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?

Look at this, TV-TWO Signature Campaign: (https://bitcointalk.org/index.php?topic=2884232.0). No KYC was mentioned when they started their campaign.

And then their token bounty campaign can be found here; (https://bitcointalk.org/index.php?topic=2617590.0)

Bounty has successfully ended. Thank you everyone for your support!

Dear Bounty Hunters,

We have received an updated opinion from our legal council that urges TV-TWO to perform KYC on all individuals and companies that receive our tokens. While this is nothing new concerning our investors, it does come as a surprise to us that this also covers any entity that participated in marketing and bounty activities. The change comes in light of new regulation that qualifies transferring tokens to sanctioned parties as aiding and abetting in criminal activity.

What does this mean? We need to ask any bounty hunter to complete the following KYC form on the TV-TWO website: https://tv-two.com/bounty.html.
During the process, please enter the same Ethereum address that you have used in the bounty spreadsheets. Once your KYC is reviewed and approved, we will transfer the tokens that you have earned during the campaign to your wallet. Distribution starts on August 24.

But at the last minute specially when bounty hunters are waiting for their payments, they posted that so many bounty hunters are confused and disappointed because we all know that most of us doesn't want to give sensitive information like our passport.

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August 31, 2018, 06:02:20 PM
 #45

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?

Look at this, TV-TWO Signature Campaign: (https://bitcointalk.org/index.php?topic=2884232.0). No KYC was mentioned when they started their campaign.

And then their token bounty campaign can be found here; (https://bitcointalk.org/index.php?topic=2617590.0)

Bounty has successfully ended. Thank you everyone for your support!

Dear Bounty Hunters,

We have received an updated opinion from our legal council that urges TV-TWO to perform KYC on all individuals and companies that receive our tokens. While this is nothing new concerning our investors, it does come as a surprise to us that this also covers any entity that participated in marketing and bounty activities. The change comes in light of new regulation that qualifies transferring tokens to sanctioned parties as aiding and abetting in criminal activity.

What does this mean? We need to ask any bounty hunter to complete the following KYC form on the TV-TWO website: https://tv-two.com/bounty.html.
During the process, please enter the same Ethereum address that you have used in the bounty spreadsheets. Once your KYC is reviewed and approved, we will transfer the tokens that you have earned during the campaign to your wallet. Distribution starts on August 24.

But at the last minute specially when bounty hunters are waiting for their payments, they posted that so many bounty hunters are confused and disappointed because we all know that most of us doesn't want to give sensitive information like our passport.
I don't think thats a good luck for them to implement KYC after the fact. What are your thoughts? Would you have still been a bounty if you needed to perform KYC?
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September 02, 2018, 10:16:17 PM
 #46

Depends on the individual. But I do believed that majority of us doesn't want to share our private data right? So I think those people will likely won't join that bounty the minute KYC is being enforced. Again, you can't blame them though, because it was a last minute changes and no one is expecting it. I suggest you follow that bounty and see how it goes for the participants (willing to submit to KYC in order to get their tokens, or not take the risk of giving their passports.)

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September 03, 2018, 12:19:24 AM
 #47

What determines if an ICO requires KYC and AML?

If the Bitcoin currency on that place of their project address or registry is legal in which KYC and AML is part of their regulation policies then all ICOs will need to comply or their ICO project will be branded as illegal to operate. Therefore it will be determine on which country they where belong.

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September 03, 2018, 07:18:27 AM
 #48

In some cases, more and more ICOs consider voluntary compliance with Know Your Customer (KYC) and Anti-Money Laundering (AML) regulations for various reasons. including to establish credibility with the Bank.

In other words, strong KYC during the tokens making event will make it easier to work with banks and follow AML regulations. Voluntary fulfillment in sign sales seems to give the project a legitimate stamp. Many prospective regulators seem to be open to selling tokens provided the law "knows your customers" are obeyed.
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September 03, 2018, 08:29:16 AM
 #49

What determines if an ICO requires KYC and AML?

If the Bitcoin currency on that place of their project address or registry is legal in which KYC and AML is part of their regulation policies then all ICOs will need to comply or their ICO project will be branded as illegal to operate. Therefore it will be determine on which country they where belong.
That's right most of the purpose of every ICO asking for KYC is this, because some country are restricted to participate. But you still need to be careful because some project ask for your KYC for the purpose of scamming. Those legit ICO will usually ask for you KYC and AML now so they will know if the investors are qualified to own their token, its actually good for the both side so don't be scared filling up that one if the project is good.

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September 03, 2018, 05:54:14 PM
 #50

Should I implement KYC/AML and do it myself or should I work with a trusted company to do so? I think that doing it myself will have a risk for the business in case of a hack, whereas using a company that has experience doing it is much secure.
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September 04, 2018, 04:20:38 PM
 #51

Should I implement KYC/AML and do it myself or should I work with a trusted company to do so? I think that doing it myself will have a risk for the business in case of a hack, whereas using a company that has experience doing it is much secure.

Crypto platform is not very safe and even if you used a company which is so called secure, there's a possibility that they could crack it as well. Just look at how many exchanges are very hack, any project should not do a KYC/AML all they have to do is implement restrictions, they can even banned IP for restricted countries if they doesn't want to have a legal issues later and scrutiny from regulatory bodies. IMHO.

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September 04, 2018, 04:48:26 PM
 #52

Depends on the individual. But I do believed that majority of us doesn't want to share our private data right? So I think those people will likely won't join that bounty the minute KYC is being enforced. Again, you can't blame them though, because it was a last minute changes and no one is expecting it. I suggest you follow that bounty and see how it goes for the participants (willing to submit to KYC in order to get their tokens, or not take the risk of giving their passports.)
What sucks here the most are ICOs who don't disclose or mention anything about KYC during their pre-sale but after the TGE took place they will suddenly have a KYC requirement before they even send the tokens you have bought from them. I remembered in one of the Telegrams group of the ICO I participated in thousands of the members got shocked and furious at the same time that they are suddenly requiring KYCs out of nowhere and it took awhile for us to receive our tokens. They somehow hide the fact from people that KYC is an important step for you to receive the tokens you have bought from them during the token sale. This is probably why they hide the KYC requirement in the first place as it is highly unappealing to a lot of people.

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September 04, 2018, 08:03:36 PM
 #53

Depends on the individual. But I do believed that majority of us doesn't want to share our private data right? So I think those people will likely won't join that bounty the minute KYC is being enforced. Again, you can't blame them though, because it was a last minute changes and no one is expecting it. I suggest you follow that bounty and see how it goes for the participants (willing to submit to KYC in order to get their tokens, or not take the risk of giving their passports.)
What sucks here the most are ICOs who don't disclose or mention anything about KYC during their pre-sale but after the TGE took place they will suddenly have a KYC requirement before they even send the tokens you have bought from them. I remembered in one of the Telegrams group of the ICO I participated in thousands of the members got shocked and furious at the same time that they are suddenly requiring KYCs out of nowhere and it took awhile for us to receive our tokens. They somehow hide the fact from people that KYC is an important step for you to receive the tokens you have bought from them during the token sale. This is probably why they hide the KYC requirement in the first place as it is highly unappealing to a lot of people.
This is what somehow a strategy nowadays for those ICO which they do hide it out on earlier phase just to deceived investors that they aren't requiring any KYC and actually I had experienced the same thing too where Ive been too confident on investing because I know theres no such verification needed into its investors but in the end they do ask out for you to claim your tokens which is really shocking on investors side.
You would really be put up on a situation which you wont really have any choice but to comply it since you already invested.If you do see that those tokens are really worth then you would comply it but if not then better leave it if you cant afford to give out your own informations.

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September 04, 2018, 08:37:25 PM
 #54

Should I implement KYC/AML and do it myself or should I work with a trusted company to do so? I think that doing it myself will have a risk for the business in case of a hack, whereas using a company that has experience doing it is much secure.

Crypto platform is not very safe and even if you used a company which is so called secure, there's a possibility that they could crack it as well. Just look at how many exchanges are very hack, any project should not do a KYC/AML all they have to do is implement restrictions, they can even banned IP for restricted countries if they doesn't want to have a legal issues later and scrutiny from regulatory bodies. IMHO.
So you're suggesting not doing KYC/AML and just banning IPs of certain countries? What are the pros and cons of doing such a thing?
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September 04, 2018, 08:49:32 PM
 #55

Depends on the individual. But I do believed that majority of us doesn't want to share our private data right? So I think those people will likely won't join that bounty the minute KYC is being enforced. Again, you can't blame them though, because it was a last minute changes and no one is expecting it. I suggest you follow that bounty and see how it goes for the participants (willing to submit to KYC in order to get their tokens, or not take the risk of giving their passports.)
What sucks here the most are ICOs who don't disclose or mention anything about KYC during their pre-sale but after the TGE took place they will suddenly have a KYC requirement before they even send the tokens you have bought from them. I remembered in one of the Telegrams group of the ICO I participated in thousands of the members got shocked and furious at the same time that they are suddenly requiring KYCs out of nowhere and it took awhile for us to receive our tokens. They somehow hide the fact from people that KYC is an important step for you to receive the tokens you have bought from them during the token sale. This is probably why they hide the KYC requirement in the first place as it is highly unappealing to a lot of people.
This is what somehow a strategy nowadays for those ICO which they do hide it out on earlier phase just to deceived investors that they aren't requiring any KYC and actually I had experienced the same thing too where Ive been too confident on investing because I know theres no such verification needed into its investors but in the end they do ask out for you to claim your tokens which is really shocking on investors side.
You would really be put up on a situation which you wont really have any choice but to comply it since you already invested.If you do see that those tokens are really worth then you would comply it but if not then better leave it if you cant afford to give out your own informations.
Check out Digitex's term and conditions https://digitexfutures.com/terms-and-conditions/ They decided not to implement KYC/AML, but rather mentioned that US residents shouldnt participate. Is this sufficient enough? Do you see any legal issues with that?

You represent and warrant that you are not a resident or domiciliary of the United States of America or purchasing DGTX TOKENS from a location in the United States of America, nor are you an entity (including but not limited to any corporation or partnership) incorporated, established or registered in or under the laws of the United States of America, nor are you purchasing DGTX TOKENS on behalf of any such person or entity;
timerland
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September 06, 2018, 12:17:12 AM
 #56

What determines if an ICO requires KYC and AML?

The main thing is the regulation in the country that the project is operative in.

Search up some information from the SEC or the SEC equivalent in your country which deals with cryptocurrency securities regulation. If they require ICOs to register their investors and produce KYC/AML documents on them, then you definitely should do some to be compliant.

Based on current trends, I'd say that's probably a lot, if not most countries.

On a side note, perhaps also consider who your investors are. Many ICOs reject investors from certain countries because of regulations.

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September 06, 2018, 01:45:15 AM
 #57

What determines if an ICO requires KYC and AML?

The main thing is the regulation in the country that the project is operative in.

Search up some information from the SEC or the SEC equivalent in your country which deals with cryptocurrency securities regulation. If they require ICOs to register their investors and produce KYC/AML documents on them, then you definitely should do some to be compliant.

Based on current trends, I'd say that's probably a lot, if not most countries.

On a side note, perhaps also consider who your investors are. Many ICOs reject investors from certain countries because of regulations.
Why not just put a disclaimer on the website saying that certain countries shouldn't participate. If that person does then they are there ones to face legal issue, not the company
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