There are both the kinds of consumers in the cryptocurrency world—those that want to follow regulations on the technology and the others that think regulations as their privacy disruption.
Additionally, those who look at this from a privacy disruption perspective consider the act of regulating cryptocurrencies as a retrograde move from the benefits they provide, comprising privacy and anonymity. News.bitcoins.com, a bitcoin-related news provider company, helps consumers gain the latest insight into KYC/AML’s importance for crypto adoption.
Particularly, cryptocurrency exchanges were a target for regulators requiring their KYC and AML regulation to be carried out by the exchanges. While some of these exchanges meet the terms with the call, others do not appreciate gathering any information about their customers. These exchanges alleged to be a violation of the customer’s right to privacy and concealment.
Regulators around the world are captivating the challenge to ensure compliance with KYC and AML is followed by these exchanges. Some cryptocurrencies are now compliant with KYC, which can help for exchanges such as Electroneum (ETN). On the other hand, it’s not so easy for the exchanges to set platforms compliance free in order to help billions of unbanked individuals to access financial services across the globe.
Without adapting KYC compliance, Ethfinex Trustless, one of the popular Decentralized Exchange (DEx) launched its exchange in September 2018. Other exchanges comprise Hodl Hodl and Binance, which are among the most significant trading volume crypto exchange that allows trading without KYC compliance implementation. Binance, though, has strict AML systems to keep the exchange without scams and illegal money.
The cryptocurrency industry is greatly blamed by regulatory proponents of serving crime around the world and money laundering. However, the industry faces these illegal activities less than traditional financial systems, which raises the question of whether regulation is needed in the field. Majority of the crypto exchanges complained about the increased cost of implementing KYC compliance regulations. Kraken, a U.S-based cryptocurrency exchange protected various investors by issuing a complaint about the increase of the expenses of handling subpoenas.
AML and KYC regulations are vital in the field, and these laws should be developed together with players in the crypto industry. These will guarantee that effective laws are put in place, while at the same time, discouraging harmful laws for the field’s growth and innovation.