Meaning of kyc in crypto

 

KYC stands for Know Your Customer. In crypto, it's a process that platforms use to verify the identity of their users in order to comply with laws, especially AML (Anti-Money Laundering) regulations

What does kyc involve 

To complete KYC, users are usually required to submit:

1. Government-issued ID (e.g., passport, driver’s license)

2. Selfie or facial verification

3. Proof of address (e.g., utility bill, bank statement)

4. Sometimes, source of funds or occupation info

 Why KYC Matters in Crypto

KYC helps crypto platforms:

1.Prevent money laundering 

2.Stop terrorist financing 

3.Comply with regulations 

4.Reduce fraud and identity theft 

5.Build trust with banks, regulators, and users 

Where KYC Is Used in Crypto

You’ll typically encounter KYC on:

Centralized exchanges (CEXs) like Binance, Coinbase, Kraken 

Fiat on/off ramps (e.g., buying crypto with a credit card or bank transfer) 

Launchpads or IDO platforms 

NFT marketplaces (increasingly) 

Some regulated DeFi protocols 

⚠️ Risks of Skipping KYC

If a project or platform doesn’t follow KYC rules when required: 

It could be banned, fined, or shut down 

Users might lose access to funds or services 

It could be blacklisted by other platforms and partners 

✅ Final Takeaway

KYC in crypto is:

1. A compliance tool to fight crime and meet regulations 

2.Increasingly required in most countries 

3.Controversial in privacy-focused parts of crypto