The main cryptocurrency exchange KuCoin is working to strengthen its Know Your Customer (KYC) by introducing new mandatory identity checks.
On June 28, KuCoin officially announced the next upgrade to the KYC system in a move to increase compliance with global anti-money laundering regulations.
The KYC authentication update introduces mandatory KYC checks for all new users on KuCoin starting July 15, 2023. Without completing KYC, newly registered users will not be able to access KuCoin's suite of products and services, the firm said.
Existing users who registered before July 15, 2023 will also need to complete the KYC process to access some features on KuCoin. Such users will not be able to deposit new funds, while withdrawals will not be affected, the announcement states.
Existing KuCoin users will still be able to use services such as spot trading sell orders, futures trading deleveraging, and margin trading deleveraging. Other services available to existing non-KYC users include redemptions at KuCoin's lending and gambling hub, KuCoin Earn, as well as redemption of exchange-traded funds.
โAs a globalized exchange, KuCoin closely monitors the crypto policies of various countries and adheres to compliance requirements, providing users with greater asset security,โ stated KuCoin CEO Johnny Lyu. He said KuCoin's new KYC system will not only increase compliance on the platform, but will also help better protect the "security of all cryptocurrency users' assets."
Lyu added:
โWith the development of the cryptocurrency industry, cryptocurrencies have gradually gone from geeky to mass adoption. However, this process has also led to certain security issues related to on-chain assets."
KuCoin did not immediately respond to Cointelegraph's request for comment on whether the new KYC system applies to all users and details about its current KYC requirements. This article will be updated pending further information.
The new KYC update will affect a significant number of cryptocurrency users around the world. KuCoin says had over 20 million registered accounts on its platform as of July 2022.
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KuCoin is also one of the largest crypto exchanges in the world by trading volumes. At the time of writing, KuCoin's daily trading volumes amount to around $540 million, with more than 8 million monthly visits. according to CoinGecko data. For comparison, Kraken, the major exchange based in the United States, has around 5 million visits per month, with around $380 million worth of cryptocurrency traded daily.
Some other cryptocurrency exchanges have also increased their KYC policies recently. In May, the Bybit exchange restricted non-KYC users to withdraw more than 20,000 Tether (USDT) monthly. Cybercriminals have reportedly capitalized on KYC requirements sell hacked and verified crypto accounts on the darknet for $30 as of April 2023.
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