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KYC - A win-win situation for crypto exchanges and consumers

Crypto exchanges with KYC checks may have a competitive advantage over those with only minimum requirements.

Photo by Dylan Calluy / Unsplash

Cryptocurrency is a quickly evolving industry where new trends, such as decentralized finance (1) and non-fungible tokens (2), are developing in seconds. As demand for these digital assets rises, so does the need for regulation.

Cryptocurrency exchanges anticipating these rules and having the necessary procedures in place for future compliance can position themselves as industry leaders. Those who only do the bare minimum risk losing ground as clients shift to more reliable options.

Exchanges have the potential to play a significant role in establishing the regulatory tone by going above and beyond the call of duty to protect users better. Doing so can help their companies establish a reputation for security (3), give them a competitive advantage, and demonstrate to regulators how policies function.

Prioritizing flexible, future-proof solutions enables exchanges to enter a new market more quickly while controlling operating costs, lowering risks, and improving client experience.

The identity verification system draws from hundreds of worldwide data sources, accelerating onboarding and providing the ideal mix between security and friction, enabling crypto exchanges to achieve compliance.

Exchanges need to gain a competitive edge in a market that becomes more congested with each bull run in the price of the cryptocurrency to onboard consumers fast and safely. To build confidence and safety while rapidly growing their customer base, exchanges can benefit from quick, accurate digital identity verification. Additionally, enhanced KYC checks (4) can aid exchanges in scaling more swiftly.

Exchanges can set themselves up for future regulation changes by knowing precisely who their customers are and how they establish the funds' origin. The regulation of the cryptocurrency industry has been a hot topic, and traditional KYC processes can limit the number of people who can be verified, particularly if they call for a passport, driver's license, or bank account.

Although most people may disagree with the term "KYC," it highlights the promise and security of space's future. User authentication (5) uses selfies and regulation in the cryptocurrency field.

If KYC and Anti-Money Laundering crypto checks are applied properly, exchanges navigating the stormy seas of regulation could obtain quick, fast, and accurate results. This approach can also help crypto businesses strengthen their infrastructure so that they are prepared when the next bull run brings a new wave of customers for exchanges.