KuCoin exchange introduces a new KYC system

KuCoin exchange introduces a new KYC system

Time Stamp: July 6, 2023 4:00 AM
  • During the first quarter of 2022, the KuCoin exchange received a $150 million pre-Series B funding round from several investors.
  • On June 28, KuCoin officially announced an upcoming KYC system, increasing compliance with global Anti-Money Laundering regulations.
  • KuCoin Exchange achieved a cumulative trading volume for Sports and Dutures surpassing the $2 trillion milestone.

The after-effects of the 2022 crypto crash still heavily weigh on the crypto ecosystem. Several crypto exchanges are yet to throw down the towel amid lawsuits and low trading volumes. Several regulatory bodies have taken stern precautions in the past few months. Unfortunately, this has resulted in the loss of numerous crypto-based organizations that couldn’t keep up with the storm of the crypto winter. Many might view it as a downside for the ecosystem, but few can embrace its positive impact. The harsh crypto winter has forced the top crypto exchanges to find new ways to survive. As a result, the KuCoin exchange, a titan in the ecosystem, will introduce a new KYC system in July. This will provide a new web3 identification system increasing its blockchain security measure.

By providing an additional system for security, KuCoin has dealt with one of the vital areas in the crypto market; trust. Will this new crypto identification system provide the reassurance its users need? Or will its implementation not affect the exchange’s current trajectory?

KuCoin Exchange, the titan amid the storm

KuCoin exchange is the fourth largest crypto exchange within the market, according to CoinMarketCap. This crypto titan is among the few exchanges launched and founded in Africa. This top crypto exchange has its headquarters in Seychelles, and its developers officially launched it in 2017. However, Michael Gan, Eric Don, Top Lan, Kent Li, John Lee, Jack Zhu, and Linda Lin founded the organization in 2013. At the time, the crypto market was still under heavy suspicion, but it steadily gained traction as the years progressed.

Also, Read Lack of education hampering crypto adoption and Acceptance in Africa.

KuCoin exchange is among the few crypto exchanges to successfully launch and has numerous users. According to CoinMakrketCap, the organization still retains a daily trading volume of more than $519 million. As one of the top crypto exchanges, it has over 20 million users and is operational in more than 200 countries. 

Throughout the years, the organization has achieved significant milestones. During the first quarter of 2022, the KuCoin exchange received a $150 million pre-Series B funding round from several investors. This achievement brought its valuation to $10 billion. During the same period, the top crypto exchange achieved a cumulative trading volume for Sport and Dutures surpassing the $2 trillion milestone.

This showcased a 180% growth since 2021. At the same time, the organization acquired 9.75 million new and active users. Unfortunately, like all the top crypto exchanges, KuCoin has substantially suffered from the events that transpired in 2022 came to an end.

The organization faced several backlashes and defaming rumours of its operations. It lost several users, and its trading volume significantly dropped. Concerns emerged over the rapid fall of stablecoins within the top crypto exchange. According to experts, at least $300 million had left the exchange within the period. Fortunately, its CEO, Johnny Lyu, denied these allegations and stated that the $300 million was merely a swap from the USDT network to Tron.

KuCoin Exchange introduces a new KYC system.

Fortunately for the KuCoin exchange, its lack of ties with FTX spared it numerous legal lawsuits. Unfortunately, this did not save it from the declining trading volume. To reassure its users and establish a new crypto security system KuCoin exchange announced the implementation of a new Web3 identification system.

On June 28, KuCoin officially announced an upcoming KYC system, increasing compliance with global Anti-Money Laundering regulations. With the current strain of regulatory bodies finding better crypto security features appears to be the best option for most exchanges. 

KYC-system

The basic components of a KYC system.[Photo/Medium]

Also, Read NFT National Identification System: The next step for Africa’s NFT Marketplace.

According to the KuCoin exchange, the new web3 identification system will introduce mandatory KYC checks. The KYC system will be functional from July 15, 2023, and all users, new and old, will have to comply with the changes. 

Furthermore, new users will have to complete all directives from the KYC system. Afterwards, they will gain access to any of its products and services. According to the announcement, the new KYC system will prevent any user from depositing new funds. Although, all withdrawals will remain unaffected.

According to the CEO, this new Web3 identification system will ensure its crypto security measures are up-to-date reassuring regulators and users. Johnny Lyu said, “A complete KYC process requires users to provide their name, identification number, and identification photo, and undergo facial recognition.” 

Also, Read Blockchain and KYC have a symbiotic relationship.

He added, “Typically, we require customer identification information, including their name and further identifiers such as a physical address, date of birth, and national ID number.”

In addition, this top crypto exchange also collects additional information related to the customer’s business and risk profile. The CEO said, “KuCoin exchange has always adhered to.”

Conclusion

With the establishment of a new web3 identification system, KuCoin may survive the current onslaught of lawsuits. Currently, the SEC has persecuted any exchange whose crypto security system is not on par with set regulations. Fortunately, the US has not officially licensed the KuCoin exchange and thus is exempt. Unfortunately, the pressure on crypto regulations is still a valid issue for most regions. The KuCoin exchange might retain and improve its trading volume with this new KYC system. 

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