Why don't crypto traders want to do KYC?
Direct from the desk of Dane Williams.
In my previous post, I discussed the concept of buying HBD without KYC compliance.
This topic generated a lot of discussion in the comments below and raised a common question among readers: Why do some crypto traders choose not to complete KYC?
This is a valid question, as many people view crypto as being associated with illegal activities.
Ooo crypto - Pwopa norty!
In this post, we will delve deeper into why not completing KYC is a personal choice that even law abiding individuals are free to make.
Do you trust the organisation or government with your data?
It basically comes down to whether you trust the organisation that you're giving all of your personal details to.
The idea behind KYC is that it makes it harder for scammers and money launderers.
That it's meant to protect you.
But the reality is that it doesn't actually do this and instead, opens you up to a whole raft of risks in the process.
First, you have to trust that they're not selling your data to advertisers.
Because once your info has been sold once, it's out in the wild and you’re not getting it back.
Second, you have to trust that the organisation you're giving your details to store it securely.
Countless examples of data hacks and leaks show that even the largest, most trustworthy companies don't do enough in this regard.
Third and finally, you have to trust that the organisation won't pass your details onto government/law enforcement unfairly.
You might say that you're not a criminal and that's fair enough.
This is certainly less of a concern in the west.
But having your financial assets frozen for political/cultural beliefs is a real issue in large parts of the world and again you're trusting that things out of your control won't change for you.
Ultimately, it is up to each person to weigh the potential benefits and risks and make an informed decision on whether or not to complete KYC before trading crypto.
It is also extremely important to research and be aware of the policies of different companies before using their services, as well as your legal obligations to the country in which you reside.
Ahem.
Final thoughts on not wanting to do KYC
For me personally, the three reasons outlined above make it clear why having a non-KYC option to buy a truly decentralised USD pegged asset like HBD, is extremely important for large portions of the planet.
I most certainly feel like the tech has long passed financial regulators and those trusted with building KYC and anti-money laundering legislation in many countries, including my own.
The reality is that we see these KYC rules and regulations have zero effect on the criminal activity that it was put in place to prevent.
Instead, it simply inconveniences all the way up to downwrite screws over those of us just trying to live our lives.
Best of probabilities to you.
Posted Using LeoFinance Beta
The KYC thing is all about control and taking advantage of the masses mostly the legit earners. As you rightly say it does not have much effect on the criminals as they know how to bypass all the rules.
I do think that that for most governments, they're trying to do the right thing.
But they simply don't, or more likely don't want to understand the tech available and that it's completely passed them by.
Posted Using LeoFinance Beta
That is true, The Government has a lot of catching up to do.
Posted Using LeoFinance Beta
When you do KYC, it seems you are secure. But you trust a third party to keep your data safe and secure. Data breach and hack is common these days. Doing KYC can make you vulnerable to attack if your data gets into the wrong hands.
Posted Using LeoFinance Beta
The security of your data is a legitimate concern for someone who may not want to do KYC.
Posted Using LeoFinance Beta
I don't exactly trust the exchanges that much because we don't know what they will do with that data. KYC itself doesn't make your life any easier and all it does is alleviate the company's worries that you are a real person. However, I wonder if that is even needed because they shouldn't care so long as they get your money.
Posted Using LeoFinance Beta
All the company cares about is complying with regulatory rules of the jurisdiction they are in.
My biggest issue is with the regulators making rules that don't actually solve the problems they say they're trying to solve.
In today's globalised, digital world, the reality is that no matter the rules they put in place, the tech has passed them by and they can always be bypassed.
Posted Using LeoFinance Beta
They do so because they want to operate in that jurisdiction and I think that is kind of expected. If they don't comply, then there is no business but I do agree that they don't really solve anything. It's more about controlling crypto and also figuring out who has crypto so they can tax us later in the future.
Posted Using LeoFinance Beta
The whole KYC prevents scam talk is such bullshit. Scammers have been scamming long before the advent of crypto
Regulators that don't understand... or want to understand the tech.
Tech that's long passed them by and made them redundant.
Posted Using LeoFinance Beta
It looked and seemed like there are too many reasons why people would shy away from KYC. I think the most tempting one is selling off these data for some hefty amount of money, I mean, you can't actually tell they did so, more reason why they're likely to do it. I feel that overtime, well get Sophisticated options that would replace KYC, as for now, too much are just at stake and people do not want to risk all these possibilities
Posted Using LeoFinance Beta
This.
I wonder how many 'data breaches' were just the company selling off their customers data.
We'll never know!
Posted Using LeoFinance Beta
That's true, I guess we'll never really know.
Trust the government or organization of my data and there was a data leaking. I just hope my data wasn't there. 🤷♂️ They said, "It's a bluff. Hacker just got public data that's already on the public for more than a year ago." So, to sum it up... It's already leaked more than a year ago and we just know it now because someone sniffs the attacker on the deep web and shares it on media? 🤔
*Real experience
There's always a risk when we put our data, especially KYC to a company. We should do background checking of their security first.
It's good, to be honest. When we don't use our KYC, we must know that there are scammers and money launderers. So, we are the ones who must protect ourselves.
Conclusion: What risk do you want to take?
Risk of data leaking or Risk of meeting scammers and money launderers?
The answer will be their choice to use KYC based or non-KYC based
Sorry to hear you had an experience like that with your own data :(
Concerns about doing KYC are legit!
Posted Using LeoFinance Beta
I just hope the government and other company who ask to do KYC at least has good security first on their system.
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The above two quotes summarized for me the failure of undergoing KYC. I wish a time will come in crypto that the KYC process will be viewed by the majority as something contrary to the very nature of cryptocurrency, decentralization, and the like.
Posted Using LeoFinance Beta
I think it shows that the majority of people don't actually want decentralisation or to take personal responsibility.
If they did, then the all but useless regulators wouldn't be a thing anymore.
The tech already makes them all but redundant in reality!
Posted Using LeoFinance Beta
Yeah, every time I think about it, my head spins.
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Aside from trusting the government with my dad, I don't like KYC from a privacy perspective... Too much intimacy invasion even in crypto. Look at Hive, wallets are still public...
Privacy options will come to HIVE.
At this point it's inevitable.
Posted Using LeoFinance Beta
As someone who experienced the consequences of a massive data breach, I couldn't agree more. While advertised as absolutely necessary, KYC does more harm than good in the long run. There isn't a single entity that can guarantee security either online or offline.
It's bad enough if people steal your email and password, you don't want them stealing your identity as well.
Posted Using LeoFinance Beta
Sorry to hear you got hit :(
You just feel so helpless once its out!!
Posted Using LeoFinance Beta
I do understand both sides of this and believe regulation has to happen whether we like it or not. For adoption to happen it has to involve KYC as we will never move forward and onboard the big money.
Posted Using LeoFinance Beta
I see the inevitability that there will be 2 parallel running systems.
The 'safe' regulated option in one system.
But with another decentralised, untouchable system always giving people an option.
Hive is already a part of the second.
It literally doesn't matter what a country's regulator thinks about HIVE or HBD, it is out and untouchable.
It's on a parallel system of its own.
Posted Using LeoFinance Beta
Yes I see this and why I am happy to be part of Hive as well as the regular stuff as well. I think you need to have both as if the shit hits the fan you can always move the value back to Hive.
Posted Using LeoFinance Beta
I don't mind KYC, even if I consider crypto to be a free and borderless payment instrument that should not be forced to such constraints that are not inline with their intrinsic properties. But as there are also bad elements used for negative things, I understand the need for such.
Posted Using LeoFinance Beta
People should just always have a choice.
This is why networks like Hive are so important.
Running on a truly decentralised, untouchable parallel.
If they want safety, they are free to choose the regulated options.
But if they want complete freedom and responsibility, then there's an alternative.
This is the key for me.
Posted Using LeoFinance Beta
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