What Changes are Crypto Exchanges Implementing in Light of Increased Regulatory Scrutiny?

In the face of rising regulatory scrutiny, cryptocurrency exchanges are revamping their identity verification procedures. A case in point is Singapore’s Bitget, which is set to enhance its KYC requirements from the beginning of next month. This move is in response to regulators’ frequent critiques of cryptocurrency exchanges, pointing out their perceived leniency in conducting KYC checks, which they argue, opens the door to fraudulent activities, money laundering, and terrorist financing.

Bitget’s KYC Enhancement

Bitget has announced that starting September 1, new users will need to undergo level 1 KYC verification before they can deposit or trade on the platform. This verification process requires users to provide an identity document, such as a passport, and complete facial authentication. Meanwhile, existing users have until October 1 to complete this process. Post this deadline, they will only have the options to withdraw, cancel orders, or close positions.

Criticism of Crypto Exchanges

Regulators have frequently critiqued crypto exchanges for their perceived laxity in conducting stringent KYC checks. These critiques argue that the lack of stringent KYC checks enables fraudulent activities, money laundering, and terrorist financing. Consequently, several exchanges have begun to tighten their KYC requirements in recent months. For instance, Kucoin, a larger competitor, introduced a similar program in June.

Global User Base and Trading Volume

Bitget boasts a global user base of 20 million and a 24-hour trading volume of approximately $310 billion, according to CoinGecko data. By contrast, Kucoin had 27 million users as of the end of 2022. The two largest exchanges, Binance and Coinbase, each have over 100 million users.

As exchanges continue to evolve their KYC requirements, platforms like cryptoview.io can be a valuable resource for users to stay informed about these changes and understand how they may impact their trading activities.

With the constant changes in regulatory requirements, it’s more important than ever for crypto exchanges and users alike to stay informed and adapt to the evolving landscape. It’s clear that as the crypto space continues to grow, the need for stringent KYC requirements will only become more critical.