Arising from the potential threat that cryptos could be used for many illegal transactions governments are begging to ask that know your customer (KYC) regulations and Anti Money Laundering (AML) processes are completed. This is to curb the use of cryptos for illegal purposes.
However, cryptos amidst the ravaging COVID-19 the globe is battling would be of more use now. This is primarily because of the growing economic uncertainty the pandemic has aroused. Cryptocurrencies since its launch ten years ago are seen as innovative technologies and lauded by many enthusiasts and also subjected to criticism by critics.
Need for KYC regulations
KYC regulations are required to identify clients and, in case of illegal transactions are easy to trace. They are monitored and enforced by regulators. America is one country ensuring mandatory KYC and AML processes. According to Binance CEO in the U.S. Catherine Coley, the KYC regulation is an issue because of the decentralized nature of digital assets.
However, the firm has to be law-abiding even though it hinders users in the country from enjoying complete freedom of crypto.
The exchange firm also has been very impactful spreading freedom crypto brings around the globe, especially in Africa. Crypto use in Africa has been on the rise as awareness about the digital asset continues to grow in the continent. Binance CEO Changpeng Zhao said in an interview recently that the crypto market in Africa is pivotal; but then, for many unbanked Africans completing KYC processes is a problem as denying them access to crypto services.
Untold stories around Bitcoin, Coley speaks
In a podcast, Coley discussed issues faced as regards delivering crypto services to potential clients and clients. One of the things Coley mentioned was that only internet-enabled people could access crypto services; hence, they miss out on a larger number of potential clients who are not internet-enabled.
As regards KYC regulation, such cannot be completed except if customers own a bank account. It further means that such a person’s name has to appear on a utility bill too. According to Coley, there is a possibility that many women don’t have their names on utility bills or leases, therefore, denying them crypto service access too.