There’s no escape from verification in the world of financial and banking operations. In case you didn’t know, verification is often referred to as KYC or Know Your Customer. It is a mandatory process for identifying and verifying customers the world over.
Originally, verification laws were introduced in 2001 as part of the Patriot Act, which was passed after 9/11, to provide a wide range of legal means to deter or highlight potential terrorist behavior. Today, every legal and transparent financial product requires KYC verification.
Why Introduce KYC Verification?
The aim of verification is not to annoy the customer with bureaucracy and paperwork, but to prevent identity theft, money laundering, terrorist financing, and financial fraud. A verification check allows a company to better know their customer and manage risks accordingly.
KYC and AML: What’s the Difference?
The AML concept is much broader than KYC. AML stands for Anti-Money Laundering and refers to a set of policies, laws, and regulations to combat generating income in a fraudulent way.
However, KYC and AML are connected. For example, if a digital exchange has established KYC procedures, it shows that the startup is legitimate. If a project is following AML and KYC regulations, it has a greater potential to start successful collaboration with the banking sector. Why would they want to do that? Many digital exchanges are struggling to get a bank account to simplify global financial operations. Banks, in turn, are struggling to trust digital exchanges in terms of AML. This is where verification and transparency come into play and are so important.
Why Does KYC Verification Matter?
KYC is a manual process that includes physical verification of document scans. It is important because it makes sure that the customer and the information provided by them are real.
Verification and Digital Exchanges
At a first glance, the idea of applying verification requirements to registration contradicts one of the main principles of the Crypto-world – anonymity. But if we dig deeper, anonymity becomes a dangerous weapon in the wrong hands.
In essence, the verification process for digital exchanges and banks is the same. It always requires proof of identity (POI), proof of address (POA), and other relevant information. However, the actual steps included in the process may differ.
Cryptocurrency exchanges can request or accept different types of IDs, ask to sign different forms, and include different procedures overall.
What Happens if I Refuse to Provide the Documents?
This one is easy. If you refuse to provide any of the requested documents, you won’t be able to buy, sell, or trade crypto with that exchange. You must comply if you wish to enter the crypto-scene legitimately.
OK… Which Documents Do I Need?
The most important documents for submission are proof of identity and proof of address.
The following documents are generally accepted as proof of identity:
- Driving license;
- Voter’s Identity Card
When it comes to proof of address, the documents that can be submitted are as follows:
- Utility bill, e.g., telephone bill, electricity bill, gas bill;
- Bank account statement with signature verification;
- Letter from employer, bank manager of scheduled commercial banks
Profile Verification at CoinMetro
CoinMetro has implemented a profile verification procedure to respect rapidly evolving international regulations and to protect itself and its clients. By following verification tiers in full form, you will be protected from legal risks and will receive a more stable level of service.
What Kind of Identification Documents are Acceptable at CoinMetro?
- Acceptable (must include a photo):
- Government-issued photo ID;
- Driving license
- Facebook profile;
- Student card;
- Identification card without a photo;
- Credit card;
- Club membership card
What Documents Count as Proof of Address?
Any of the following documents are considered acceptable forms of proof of address, but must not be more than three months old:
- House Utility bill (electricity, water, gas, heating, Internet);
- Bank statement;
- Credit card statement;
- A landline phone (not mobile) or Internet bill
Documents that MAY be accepted (depending on your country of residence):
- Driving license;
- Income tax letter
CoinMetro cannot accept hotel bills as a proof of residence.
Check out our Frequently Asked Questions about KYC/AML verification in this document.
If you still have any questions, please don’t hesitate to get in touch with CoinMetro’s fast and diligent support team.
What Happens After Verification?
Verification updates also include monitoring customer transactions, which is an essential element of the verification policy. Why is it done? To be able to differentiate between normal and suspicious customer behavior in the financial sector, this behavior needs to be analyzed in the first place. It’s better done through transaction monitoring.
Some Problems with Profile Verification
The profile verification status check may slow down the registration process. Once you’ve signed up on a digital exchange, you need to provide the required documents and wait for them to get verified first. Until then, you can’t buy, sell, or trade.
Depending on how carefully you read the requirements, the verification process is quick or slow. It is important to check whether you have all the valid documents required. Also, there’s no point submitting an outdated document because it will be rejected by the Compliance team of the chosen exchange, and you will be asked to resubmit. To save yourself time and effort, we recommend you to always submit the right thing as described in the policy.
Verification is an amazing thing! It serves a very, very important purpose and, although it’s potentially time-consuming, it is 100% worth it!
If you’re interested in buying, selling, or trading Cryptos, choose a digital exchange that operates a Verification policy (like CoinMetro!), read their policy and requirements carefully, prepare all of your documents to pass the verification in one step…. and trade safe!
If you have any other questions for us, please don't hesitate to contact us.
-CoinMetro's Customer Support