What documents can be requested during KYC
The "Know Your Customer" (KYC) procedure plays an important role for organizations, allowing them to identify and verify their customers. This is necessary in the context of combating money laundering and terrorist financing (AML/CFT), as well as to prevent financial crimes and ensure customer reliability.
When registering on a cryptocurrency exchange, you will likely need to undergo KYC verification. As part of this procedure, financial service providers are required to ask the client for documents confirming his identity, such as an official ID card or bank statement. Similar to AML provisions, KYC aims to combat money laundering, terrorist financing, fraud prevention and illegal financial transactions.
KYC plays a key role in preventing crime, not just responding to it. Most financial services require customer information during registration, before they are even allowed to conduct financial transactions. Although in some cases accounts can be created without going through KYC, their functionality will be limited.
Passing the KYC (Know Your Customer) procedure requires the submission of certain documents confirming the user's identity and residence. Depending on the platform, the requirements may vary slightly, but the basic documents remain similar:
Passing the KYC (Know Your Customer) procedure requires the submission of certain documents confirming the user's identity and residence. Depending on the platform, the requirements may vary slightly, but the basic documents remain similar:
Passport - Primary identification document. Required in all cases.
Identity card (ID) - Can be used in place of a passport or as an additional document.
Driver's License - Often used as an alternative to an ID card.
Proof of residential address - This can be a utility bill, bank statement or tax notice. The document must be from at least the last 3 months.
Selfies with document - Some platforms require a photo with a document in hand to verify identity.
Below is a table with examples of document requirements that may be requested for KYC on popular cryptocurrency exchanges:
What to consider when going through KYC
When going through KYC, it is important to consider several key aspects to ensure that your data is secure and you are compliant with legal requirements. The KYC procedure is governed by various international agreements and laws, such as the Patriot Act in the US and the EU's 6th Anti-Money Laundering Directive (AMLD6). These regulations oblige financial institutions and cryptocurrency platforms to collect and store users' personal data.
The international KYC agreement stipulates that customer data may be transferred to verify regulatory compliance. However, the data transfer is accompanied by high data protection standards. How to explain why the data is transferred to KYC? This data helps prevent fraud and money laundering by providing security on the platform.
In addition, it is important to remember that KYC procedure by what law is regulated depends on the jurisdiction in which the platform operates. Therefore, when transferring your data, make sure that the platform complies with international security and privacy standards. Careful attention to this process will allow you to avoid problems and protect your data from unauthorized use.
The international KYC agreement stipulates that customer data may be transferred to verify regulatory compliance. However, the data transfer is accompanied by high data protection standards. How to explain why the data is transferred to KYC? This data helps prevent fraud and money laundering by providing security on the platform.
In addition, it is important to remember that KYC procedure by what law is regulated depends on the jurisdiction in which the platform operates. Therefore, when transferring your data, make sure that the platform complies with international security and privacy standards. Careful attention to this process will allow you to avoid problems and protect your data from unauthorized use.
KYC processes have become an integral part of the operation of financial services and centralized cryptocurrency exchanges, playing a key role in security and compliance. These procedures aim to prevent money laundering, terrorist financing and other crimes, making them an important tool in the fight against financial crime. While going through KYC can be inconvenient, it is a necessary step to protect users and comply with international regulations and standards.
KYC procedures are regulated through various international agreements and laws, such as the EU's 6th Anti-Money Laundering Directive (AMLD6) and the Financial Action Task Force (FATF) requirements. These regulations require financial organizations and cryptocurrency platforms to implement KYC processes to ensure security and transparency. This allows users to be confident that their data is protected and used in strict compliance with legislation.
We would also like to remind you that AML address checks is available in our Btrace solution, for which no documents are required - a simple registration is enough. The first crypto wallet check is free for each user, and you can verify the crypto address in just a couple of clicks.
KYC procedures are regulated through various international agreements and laws, such as the EU's 6th Anti-Money Laundering Directive (AMLD6) and the Financial Action Task Force (FATF) requirements. These regulations require financial organizations and cryptocurrency platforms to implement KYC processes to ensure security and transparency. This allows users to be confident that their data is protected and used in strict compliance with legislation.
We would also like to remind you that AML address checks is available in our Btrace solution, for which no documents are required - a simple registration is enough. The first crypto wallet check is free for each user, and you can verify the crypto address in just a couple of clicks.
List of references used
List of references used:
1
The Financial Action Task Force (FATF) - Guidance for a Risk-Based Approach to Virtual Assets and Virtual Asset Service Providers. Available at: https://www.fatf-gafi.org/media/fatf/documents/recommendations/RBA-VA-VASPs.pdf
2
Directive (EU) 2018/843 of the European Parliament and of the Council - On the prevention of the use of the financial system for the purposes of money laundering or terrorist financing (5th Anti-Money Laundering Directive - AMLD5). Available at: https://eur-lex.europa.eu/eli/dir/2018/843/oj
3
Financial Crimes Enforcement Network (FinCEN) - Guidance on the Application of FinCEN’s Regulations to Certain Business Models Involving Convertible Virtual Currencies. Available at: https://www.fincen.gov/sites/default/files/2019-05/FinCEN%20Guidance%20CVC%20FINAL%20508.pdf
4
Office of Foreign Assets Control (OFAC) - Sanctions Compliance Guidance for the Virtual Currency Industry. Available at: https://home.treasury.gov/system/files/126/virtual_currency_guidance_brochure.pdf
5
Basel Committee on Banking Supervision - Sound management of risks related to money laundering and financing of terrorism. Available at: https://www.bis.org/bcbs/publ/d505.pdf
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