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Major cryptocurrency exchange KuCoin is working to strengthen its Know Your Customer (KYC) system by introducing new mandatory identity checks.
On June 28, KuCoin officially announced the upcoming KYC system upgrade to improve compliance with global anti-money laundering regulations.
The KYC Authentication Update introduces mandatory KYC checks for all new KuCoin users starting July 15, 2023. Without completing KYC, new 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 be required to complete the KYC process in order to access some KuCoin features. Such users will not be able to deposit new funds, and the withdrawal of funds will remain in effect, the announcement notes.
Existing KuCoin users will continue to be able to use services such as sell orders for spot trading, de-leveraged futures trading, and de-leveraged margin trading. Other services available for existing non-KYC users include redemption at the KuCoin Staking and Lending Center, KuCoin Earn, and redemption of exchange-traded funds.
“As a global exchange, KuCoin closely monitors the policies of cryptocurrencies in different countries and adheres to compliance requirements, providing users with enhanced asset security,” said KuCoin CEO Johnny Liu. He said that KuCoin’s new KYC system will not only improve the platform’s compliance, but also help better protect the “security of the assets of all cryptocurrency users.”
Liu added:
“With the development of the cryptocurrency industry, cryptocurrency has gradually moved from gaming to mass adoption. However, this process has also raised certain security concerns regarding network assets.”
KuCoin did not immediately respond to Cointelegraph’s request for comment on whether the new KYC system applies to all users and details on its current KYC requirements. This article will be updated pending additional information.
The new KYC update will affect a significant number of cryptocurrency users around the world. KuCoin states that as of July 2022, there were over 20 million accounts registered on its platform.
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KuCoin is also one of the largest cryptocurrency exchanges in the world in terms of trading volume. According to data from CoinGecko, at the time of writing, KuCoin has daily trading volumes of around $540 million, with visits in excess of 8 million per month. In comparison, the large US exchange Kraken has about 5 million visits per month, with about $380 million worth of cryptocurrency traded daily.
Some other cryptocurrency exchanges have also been tightening up their KYC policies lately. In May, Bybit banned users without KYC from withdrawing more than 20,000 Tether (USDT) per month. Cybercriminals have capitalized on KYC requirements by reportedly selling hacked and verified cryptocurrency accounts on the dark web for $30 as of April 2023.