KuCoin, a prominent cryptocurrency exchange, has announced the implementation of a mandatory Know Your Customer (KYC) system upgrade to enhance compliance with global Anti-Money Laundering regulations. The exchange aims to bolster security measures and ensure the integrity of its platform.
In an official announcement on June 28, KuCoin unveiled its plans for the KYC system upgrade, which will require all new users to undergo mandatory KYC checks starting from July 15, 2023. Without completing the KYC process, newly registered users will not be able to access the wide range of products and services offered by KuCoin.
Existing users who registered prior to July 15, 2023, will also be required to complete the KYC process to access certain features on the platform. While withdrawals for existing users will remain unaffected, they will no longer be able to deposit new funds until the KYC verification is completed, as outlined in the announcement.
KuCoin’s existing users will still have access to services such as spot trading sell orders, futures trading deleveraging, and margin trading deleveraging. Additionally, existing non-KYC users will be able to utilise services such as redemptions at KuCoin’s staking and lending hub, KuCoin Earn, as well as the redemption of exchange-traded funds.
Johnny Lyu, the CEO of KuCoin, explained that the complete KYC process entails users providing their name, identification number, identification photo, and undergoing facial recognition. He emphasised that KuCoin diligently verifies customer identification and verification data in compliance with applicable laws and regulations.
Lyu stated, “Typically, we require customer identification information including the customer’s name and further identifiers such as a physical address, date of birth, and national ID number.” In accordance with jurisdictional requirements, KuCoin also collects additional information related to the customer’s business and risk profile, including the nature and volume of trading activity and the origin of virtual funds deposited.
The CEO affirmed that KYC has always been a fundamental principle that KuCoin adheres to and emphasised that identity recognition is an existing process. He also pointed out that KuCoin’s KYC policy is designed to comply with regulations in applicable jurisdictions, as there is currently no unified global KYC regulation.
A spokesperson for KuCoin clarified that the exchange does not support United States KYC based on its current or updated KYC rules.
The introduction of the new KYC measures will impact a significant number of cryptocurrency users worldwide. As of July 2022, KuCoin reported over 20 million registered accounts on its platform.
KuCoin is renowned as one of the world’s largest crypto exchanges in terms of trading volumes. At present, it records daily trading volumes of approximately $540 million and welcomes over 8 million monthly visits, according to data from CoinGecko. By comparison, major United States-based exchange Kraken receives around 5 million monthly visits and facilitates approximately $380 million worth of crypto trades on a daily basis.
It is worth noting that several other cryptocurrency exchanges have recently been bolstering their KYC policies. In May, Bybit exchange implemented restrictions on non-KYC users, limiting their monthly Tether (USDT) withdrawals to 20,000. Reports have also surfaced regarding cybercriminals capitalising on KYC requirements by selling hacked and verified crypto accounts on the darknet for around $30 as of April 2023.
