Prominent cryptocurrency exchange KuCoin is pushing for mandatory KYC upgrades for greater compliance.
The regulators in the United States have swung into serious action cracking down on the digital assets space following the dramatic collapse of FTX. Binance, for one, has been stuck in the middle of a coordinated attack by regulatory agencies in the country for alleged evasion of compliance controls among other things.
As a result, KuCoin has ramped up its efforts to strengthen its Know Your Customer (KYC) measures for all clients by establishing new mandatory identity checks.
🚨 IMPORTANT: In order to protect users' assets and combat money laundering, terrorist financing and related financial crimes around the world, #KuCoin will enhance our #KYC requirements.
From July 15, 2023 (UTC):
📌 Newly registered users must complete their KYC in order to use… pic.twitter.com/oTZULNqAxd— KuCoin (@kucoincom) June 28, 2023
KuCoin’s Move to Embrace Regulation
In the latest press release, KuCoin announced an upgrade of its KYC authentication rules and systems, starting July 15 in a bid to embrace global compliance requirements. As per the new rules, all newly registered users must complete KYC starting the stipulated date to access the exchange’s range of products and services. KuCoin asserted that such a requirement guarantees a “high level of accountability and transparency” within the platform.
On the other hand, existing users or users registering before July 15 who have failed to complete the KYC process will face restricted access to certain features on KuCoin. As such, accessible services will include Spot trading sell orders, Futures trading deleveraging, Margin trading deleveraging, KuCoin Earn redemption, and ETF redemption but deposit services will be unavailable.
However, exchange users are free to withdraw their assets regardless of their KYC status.
KuCoin CEO Johnny Lyu said that the decision follows the platform’s intensive monitoring of the crypto policies of various countries and compliance requirements. The exec further added that the process has highlighted certain security issues concerning on-chain assets. He said,
“In light of this, KuCoin has strengthened our KYC system to comply with regulatory requirements worldwide and better protect the asset security of all cryptocurrency users through enhanced KYC rules.”
Insolvency Rumors and FUDs
The Seychelles-based crypto exchange was the target of intense FUD surrounding bankruptcy and insolvency earlier this year. Last year’s FTX implosion created a contagion effect that led several other crypto platforms down the insolvency road with KuCoin being scrutinized as one of them. Amid rampant speculation, the exchange dismissed the FUDs and cited proof of reserve audits as evidence of its transparency and financial health.
1/ The @kucoincom handle was compromised for about 45 mins from 00:00 Apr 24 (UTC+2). A fake activity was posted and unfortunately led to asset losses for several users. KuCoin will fully reimburse all verified asset losses caused by the social media breach and the fake activity.
— KuCoin (@kucoincom) April 24, 2023
In April, KuCoin’s official Twitter account was compromised and malicious entities behind the attack posted fake activity, which led to some of its followers losing funds. The exchange vowed to reimburse affected users after identifying the breach and recovering the social media account.
