If you're using Bitstamp, now might be a good time to ditch it.

[arbiter5]

Article by Crypto Briefing: https://cryptobriefing.com/bitstamp-begins-track-off-exchange-addresses/

Basically when withdrawing from BithumbBitstamp, you would need to show proof that you own the address you're withdrawing too first.

While this rule seems to be enforced only to their users that reside in the Netherlands, I wouldn't be surprised if they would apply the same rule for exchange users in countries in the future.

While you're at it, screw using KYC exchanges. Make it a habit of using exchanges that respect your privacy.

Full credits to @plan_marcus on Twitter for the screenshots below.

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[o_e_l_e_o]

What nonsense. I thought Netherlands were big on the whole "personal freedoms" thing? And now they are introducing KYC for your own addresses!? No transactions allowed unless the government can put a name and a face on it. This is the next step on a very slippery slope towards governments taking control of bitcoin.

I note as well that Bitstamp "automatically enabled" (i.e. forced) this feature without any prior warning, essentially seizing their customers' coins and holding them ransom unless they comply with this incredibly invasive nonsense.

People need to stop accepting this kind of ridiculous snooping like they do with Coinbase, BitPay, Binance, Bitstamp. As long as we keep giving money to these unethical companies, they will continue to abuse us and keep trying to turn bitcoin in to something that makes them money and that governments can use to oppress you. Stop it. Trade peer to peer, eliminate third parties, and use bitcoin in the way it was intended to be used.

[witcher_sense]

Bitstamp is not the first exchange that has been forced to comply with Dutch law. About two months ago, Bitonic Netherlands-based exchange reported it had been forced by the country's central bank new requirements to implement new KYC measures, which include address verification via uploading screenshots or signing a message with a private key corresponding to the said address.

https://www.coindesk.com/dutch-crypto-exchange-adds-extra-verification-measures-citing-disproportionate-central-bank-requirements

What nonsense. I thought Netherlands were big on the whole "personal freedoms" thing?

The central bank, De Nederlandsche Bank, is said to be applying the Netherland's Sanctions Act to cryptocurrency exchanges, seeking to ensure their users and transaction beneficiaries are not on a Dutch or European sanctions list.
"The Netherlands is currently the only country in the European Union where this far-reaching measure is demanded," the exchange said.

[DaveF]

It's not the exchanges doing it. It's the Governments of these countries.
Yes the rules suck. Yes places like Bitstamp / Coinbase / etc. should be fighting against it. But, for them not to do it would be insane.

In the US could you picture what would happen if Chase decided to let people open accounts with no ID?

Sadly it has come to this, looks like the US will be the next on the list of these insane requirements.

-Dave

[hd49728]

Article by Crypto Briefing: https://cryptobriefing.com/bitstamp-begins-track-off-exchange-addresses/

Basically when withdrawing from Bithumb, you would need to show proof that you own the address you're withdrawing too first

LOL. It is long time I laugh at such ridiculous news.

Do I have to show proof that I own my bitcoin from the address I will use to make a deposit to an exchange? No.
They (Bitstamp) accept all deposit but when withdraw, they ask customers to show proof of ownership for the receiving address. What if the receiving address is the one I use to make deposit (before the withdrawal request). Do I still have to prove it?

And do it for any crypto on the exchange: https://coinmarketcap.com/exchanges/bitstamp/. It's not fun.

Let's make Bitstamp not your favorite exchange.

[o_e_l_e_o]

It's not the exchanges doing it. It's the Governments of these countries.

Absolutely. I assume such rules will probably spread through Europe, and I've been reading suggestions that we will soon be facing a similar situation in the US. Governments aren't just going to let you break free of their easily manipulated fiat system to something they have no control over without putting up a fight first. However, that doesn't mean we can't or shouldn't rail against these exchanges for enforcing the government's draconian laws. If an exchange enforces this, then its time to leave that exchange. I guarantee that if everyone stopped using Bitstamp because of this, they would pretty quickly find some way around it or challenge it in court, but unfortunately that is never going to happen.

When this becomes widespread there will be a big uptick in mixer traffic, since everyone who withdraws to a KYC address would be crazy to not immediately mix or coinjoin their coins. And there will be ever more DEX volume, which is never a bad thing.

[arbiter5]

What nonsense. I thought Netherlands were big on the whole "personal freedoms" thing? And now they are introducing KYC for your own addresses!? No transactions allowed unless the government can put a name and a face on it. This is the next step on a very slippery slope towards governments taking control of bitcoin.

"There are three kinds of lies: lies, damned lies, and statistics." - Benjamin Disraeli

It's not the exchanges doing it. It's the Governments of these countries.
Yes the rules suck. Yes places like Bitstamp / Coinbase / etc. should be fighting against it. But, for them not to do it would be insane.

In the US could you picture what would happen if Chase decided to let people open accounts with no ID?

Sadly it has come to this, looks like the US will be the next on the list of these insane requirements.

-Dave

Yes. But it doesn't really make the situation any better.

[Lucius]

If I understood the whole thing well, the user has to prove that he is the owner of the address to which he will withdraw the transaction - by sending a message from that address or by taking a selfie of himself and the coin address? What follows is a signed and certified statement that withdraw coins will not be used for anything illegal under threat of imprisonment or payment of some high fine

Let's make Bitstamp not your favorite exchange.

There are those who have been saying this for years, especially since they introduced the insanely strict KYC and all the possible checks that come to their mind.

Is Bitstamp still a good exchange for trading?

[Yogee]

Proof of non-custodial wallet ownership has been discussed in other topics before and it's slowly implemented by major exchanges. DEXs will welcome this news with open arms.

....Basically when withdrawing from Bithumb,

You mean Bitstamp?

If I understood the whole thing well, the user has to prove that he is the owner of the address to which he will withdraw the transaction - by sending a message from that address or by taking a selfie of himself and the coin address?

The email just says photo so writing all the characters on a piece of paper then taking a selfie.

[BrewMaster]

the biggest problem we are facing is that people still don't want to treat bitcoin as a currency and only are interested in trading it to make more fiat out of it.
otherwise if people started "earning" bitcoin, we no longer would see issues like this.

While you're at it, screw using KYC exchanges. Make it a habit of using exchanges that respect your privacy.

the problem is that sadly we don't have that alternative. we only have decentralized P2P methods of trading bitcoin that are hard to use, have low liquidity, big price spread and are slow to fill an order at times.

[MelissaVorsteiner]

Article by Crypto Briefing: https://cryptobriefing.com/bitstamp-begins-track-off-exchange-addresses/

Basically when withdrawing from BithumbBitstamp, you would need to show proof that you own the address you're withdrawing too first.

Dayum. Never used Bitstamp and would probably never use it afterwards. requesting proof of ownership is just too much imo.

[arbiter5]

the problem is that sadly we don't have that alternative. we only have decentralized P2P methods of trading bitcoin that are hard to use, have low liquidity, big price spread and are slow to fill an order at times.

While not decentralized, LocalCryptos is still a far better option due to not requiring KYC. We also have Bisq, but barely anyone uses it so it's really not that much of a viable option today.

[witcher_sense]

While not decentralized, LocalCryptos is still a far better option due to not requiring KYC. We also have Bisq, but barely anyone uses it so it's really not that much of a viable option today.

Localcryptos is definitely a good option, but not suitable for those seeking for profits.

Given the fact that the vast majority of people treat bitcoin as a speculative asset, they will continue to use centralized exchanges so that they can make a profit in dollars. More often than not, they are not interested in long-term hodling, but in short-term, mid-term trading, and investing. They mostly don't care about privacy, sovereignty, decentralization, liberty, bitcoin principles in general. They are not against any ridiculous policies such as KYC procedures, address verification, mass surveillance, etc. What they want is profit, they are ready to sell their souls to acquire additional penny. They are dollar maximalists.

[o_e_l_e_o]

If I understood the whole thing well, the user has to prove that he is the owner of the address to which he will withdraw the transaction - by sending a message from that address or by taking a selfie of himself and the coin address?

Which is ridiculous, when you think about it, given how easy it is to fool a selfie. I can import any address in to a wallet like Electrum and then take a selfie with it. That proves nothing. If you are using a web wallet then it is even more trivial - just open developer tools and you can change the address which appears in your wallet to anything you like. Lets say I want to withdraw from Bitstamp directly to a gambling site. I can just create a brand new blockchain.com wallet (for example), change the address which appears to the gambling site's deposit address in <10 seconds, and take a selfie with it. The whole thing is pointless. It will achieve exactly nothing in the fight against money laundering, will achieve a great deal in every government's pursuit to monitor all their citizens.

More often than not, they are not interested in long-term hodling, but in short-term, mid-term trading, and investing.

If you are interested in day trading, then what is stopping someone from using a P2P platform such as Bisq or LocalCryptos to on-ramp from fiat in to bitcoin, and then transfer that bitcoin to a non-KYC exchange to trade between bitcoin and stablecoins or altcoins? As much as I hate stablecoins and most altcoins, if I were a day trader I would see trading pairs using them as the far lesser of two evils when compared to completing KYC somewhere. Of course, there is still the risk that the non-KYC exchange you are using suddenly turns round and demands KYC, however.

[Lucius]

Which is ridiculous, when you think about it, given how easy it is to fool a selfie.

That's why I asked if that was really the case, because it really doesn't make sense to me - as you say, this measure can very easily be circumvented in the way you described. If they really wanted to achieve something, then they had to ask for a signed message from the address, but it is still a slightly more demanding procedure, for users and for the exchange.

It seems to me that clients will have to agree to this request, but also very likely to many others that will be put in front of them in the future - of course if they want to continue to use centralized crypto exchanges.

[20kevin20]

If this is coming to The Netherlands, then I suppose it's coming to the EU and the US soon as well?! I mean, there was a rumor that the US gov was planning to do exactly this - and here we go!

This is so close to the "virgin coins will be more expensive than tainted ones" narrative it's scary. I just wish Bitcoin users wake up before it's too late. Ditch them privacy-stripping centralized exchanges - ditch them all!

[hatshepsut93]

This is so dumb, how does a photo with an address proves that you own it? You can take a photo with any address that you want, so if your goal is to withdraw to someone else's address, this regulation is not stopping it. Even signing a message isn't a strong proof, you can ask someone else to sign a message with their address. This law achieves absolutely nothing except for creating annoyance to users of centralized exchanges and more work the exchanges. It won't do anything to prevent money laundering or other illicit activity, and it won't even allow the government to better track Bitcoin transactions.  Whomever came up with this idea must be completely tech illiterate.

[o_e_l_e_o]

Whomever came up with this idea must be completely tech illiterate.

Brought to you by the same idiots who came up with "Let's ban encryption!"

[mk4]

If this is coming to The Netherlands, then I suppose it's coming to the EU and the US soon as well?! I mean, there was a rumor that the US gov was planning to do exactly this - and here we go!

This is so close to the "virgin coins will be more expensive than tainted ones" narrative it's scary. I just wish Bitcoin users wake up before it's too late. Ditch them privacy-stripping centralized exchanges - ditch them all!

Rule of thumb: always expect the worst when it comes to privacy on exchanges(or services in general) with or without KYC. Dare I say that it will just get worse from here as Bitcoin gets bigger.

While other countries aren't like super strict yet, it's a fair assumption to think that they will follow suit after sometime.

[Lucius]

If this is coming to The Netherlands, then I suppose it's coming to the EU and the US soon as well?! I mean, there was a rumor that the US gov was planning to do exactly this - and here we go!

The fact that one EU member state implements something does not necessarily mean that it will be adopted by other member states, so AML5 is not applied in all member states, and it has been more than 1 year since it was supposed to enter into force. I live in the EU, and luckily I can still buy and sell significant amounts of crypto without any KYC or fear of tax because there is a loophole in local law that allows it.

The Trump administration initiated the procedure, but Biden already froze the decision and sent it for review.

One of the first actions President Joe Biden has taken on his first day in office is to freeze Federal regulatory process, including the controversial self-hosted crypto wallet regulations proposed by former Treasury Secretary Steven Mnuchin.
The announcement came in a White House memorandum for the heads of various federal agencies, the Financial Crimes Enforcement Network (FinCEN) included. The edict doesn’t specify the crypto wallet proposal, but places a general freeze on all agency rulemaking pending review, effective for 60 days from the date of the memorandum.

Of course, this does not mean that this decision will not be implemented, nor that there will be no other decisions that the crypto community will not like. Trump did not have a positive opinion of Bitcoin, but he clearly did not have people around him who could make a significant difference - it remains to be seen how capable or not the people from the new administration are.