KYC (Know Your Customer) — a set of operations to identify an existing user. It was invented not just like that, but to counteract money laundering of proceeds from crime (anti-money laundering, or AML).
In order to pass KYC, the user needs to provide complete (within reasonable limits) information about himself in favor of the counterparty with whom the financial transaction is performed. In this case, the company must identify and establish the identity of the counterparty before conducting the transaction.
If we are talking about a cryptocurrency exchange, then the exchange employees need to make sure that the payment will not be associated with a violation of the law. Such offenses include the use of cryptocurrency for money laundering, financing of terrorist organizations, or concealing money from taxation.
For the cryptocurrency industry, the KYC procedure began to be applied to the growing popularity of digital currencies. Initially, customer identification was carried out exclusively in the banking sector and in traditional exchange trading. An additional task that KYC helps to solve is the management of risks associated with an unidentified client.
There are 2 sides to passing KYC verification: on the one hand, it has benefits for projects from the cryptosphere, on the other hand, it is protecting interests for the users themselves. But let's talk about everything in order.
If projects in the blockchain industry conduct the KYC procedure and comply with its requirements, then they work in the legal field. Such requirements are spelled out at the legislative level for all financial organizations and companies that work with payments, in fact, this is part of the international requirements for foreign exchange transactions (including cryptocurrencies).
If a company violates the requirements for compulsory KYC / AML, it faces fines, legislative restrictions on the right to operate in certain countries, and even termination of activity in general. That is why all operations of clients of exchanges, exchange services, and financial projects should be as transparent as possible for authorized financial regulators.
In addition, passing KYC removes the limit on deposit and withdrawal of funds, positively affects the volume of allowed trades and access to additional features of the cryptocurrency exchange. The user also has the right to claim a financial refund if the funds for reasons beyond your control lose your funds. Also, by verifying within the framework of KYC, you protect your funds from loss or theft by attackers who try to gain access to your wallet or account but cannot verify your identity (if you decide to do this).
In fact, KYC is just a collection of procedures. If you strictly follow the requirements of these procedures, you can quickly go through KYC. This process has only three stages on the BTC-Alpha exchange. You will have to go through the identification, verification, and authentication of the client.
Identification consists of introducing the system to the client and providing the user with an identifier on the company’s server. The user receives a username and password and the ability to upload a photo.
Verification is the stage of submitting and verifying the documents and information provided by a certain user, after which the system confirms the identity of the person.
Authentication is a confirmation of identity upon repeated appeal. At this stage, the user enters a username and password, and the system checks his biometric data.
After logging in to your profile at BTC-Alpha, select "Verification" in the menu bar. Passing each of the verification stages will have its advantages and requirements.
It takes a minimum of time and effort, but at the same time it is an important step in the procedure. The acquaintance of the technical support service with you as a user starts with it.
This step requires the user to provide basic information — name, date of birth, nationality, contact phone number. At this stage, the moderator does not check the data. Be careful and enter the information in accordance with the documents proving your identity — otherwise, in the future, you will not be able to correctly go through the process of confirming your identity using the relevant documents.
To verify your identity, one of 4 documents is required: passport, identity card (ID), driver’s license, another identity document (passport or ID card is the best option).
You must provide the document data in text format in accordance with the original. In addition, the user must upload a high-quality photo with the aforementioned document and a note indicating the current date.
At this point, the user must provide location information for reliable accounting. To confirm residence, the user can use one of the following documents:
Utility bill (gas, water, electricity) Receipt for communication services (Internet or a landline phone) Bank/card account statement with the seal and signature of a bank representative Bank confirmation of an open account in your name with the seal and signature of the bank representative Tax service notice
Registration in the passport can be attached only in special cases, i.e., if the actual place of residence (house, or apartment) is issued to the spouse, mother, father, etc.
As you can see, you should not be afraid of KYC. The verification process takes about 6-10 minutes, and moderation by a specialist on average takes from 30 minutes to 72 hours (depending on the workload of the administrator). However, you will discover more opportunities at BTC-Alpha regarding depositing, withdrawing funds, making huge volume of trades as well as other options.