London-based cryptocurrency exchange platform CEX.IO has recently required its users to verify their identities in accordance with KYC guidelines.
Users of CEX.IO cryptocurrency exchange now need to verify their accounts before engaging in trades on the platform.
The London-based exchange has now enacted Know-Your-Customer (KYC) guidelines, which require coin holders to prove their identities by means of submitting documents, to provide “high-level and reliable service.”
Mandatory verification has come into effect on https://t.co/OPoleqNuJO. If you haven’t verified your account yet, do so shortly to get access to all payment options on https://t.co/OPoleqNuJO and increase your deposit and withdrawal limits. Details at https://t.co/ZhX2dplCYE pic.twitter.com/jSkakGz6ev
— CEX.IO (@cex_io) December 11, 2018
The new mandatory requirement applies only to old, unverified customers and potential clients of CEX.IO, which they need to fulfill before they could trade on the platform. Meanwhile, already verified users can continue enjoying the exchange’s services.
A CEX.IO official knowledgeable in the matter explained that the adoption of KYC procedures is related to the Fifth Anti-Money Laundering Directive of the European Union. This directive demands Financial Intelligence Units to “monitor the use of virtual currencies” on exchanges and trading platforms in the EU member states to combat money laundering and financial terrorism.
While the United Kingdom voted to leave the EU, the London-based CEX.IO still felt the need to follow the directive as a great number of the exchange’s customers are from EU-member states.
Serhii Mokhniev, regulatory affairs counsel for CEX.IO, was quoted as saying:
“We have always understood the importance of dealing with virtual currency within a legal framework, so mandatory verification for customers who transact in fiat currency was introduced long before the Fifth Anti-Money Laundering Directive was adopted in the EU.”
Applying KYC guidelines on crypto exchanges have brought mostly negative reactions from the community in the past. For example, when another famous exchange—Swiss-based ShapeShift—implemented identity verification procedures, famous crypto personalities have shown their disappointment in the decision with one coder declaring ShapeShift “dead.”
Only time will tell if CEX.IO’s decision would benefit the crypto community.