BitMEX Makes KYC Mandatory for All Users

Cryptocurrency exchange BitMEX has made it mandatory for all its users to follow know your customer (KYC) guidelines. The customers will have to verify their identities with the exchange by February 12, 2021.

BitMEX users have time

The Bitcoin futures exchange will begin to request its users to prove their real identities on the exchange by August 28, 2020. The firm says that the launch of its User Verification Programme will lead to a “more trusted and secure trading environment for all BitMEX users.”

BitMEX is among the many crypto companies that have started to feel the pressure to adopt both KYC and anti-money laundering or AML regulations. Both are used extensively in the traditional finance space. Since cryptocurrencies are often connected to anonymized trading, they have also been subject to criminal activity which is not sitting in line with the regulators. Recently, the libertarian-run exchange ShapeShift finally listened to the regulators. BitMEX is also honing its system to do the same.

Commercial director of 100x Group, the holding company of BitMex, Ben Radclyffe said,

“We’ve tried to make it a combination of lightweight and easy. Geographical location is quite key for us.”

A good move for the exchange

The move to follow standard KYC norms may upset some users of BitMEX in the beginning. It could be good for the users in the long run and help provide more legitimacy to the users. Fintech and crypto leader of Asia at PwC said that crypto exchanges are putting institutional-grade KYC and AML procedures in place for the development of the crypto industry. This will ensure to keep malicious actors away and make institutional users more comfortable with digital currencies.

The identification process should take about five minutes, according to the exchange. The four-step process will follow similar steps as other cryptocurrency exchanges. They will be asked for a selfie and will be asked some questions about the source of their funds and their trading experience. This could also help the exchange in verifying the actual owners of cryptocurrencies in the case of a hack, disputes, or incapacitation.