In many ways, KYC has become almost synonymous with cryptocurrencies; After all, most platforms today require users to verify their identity in one way or another before allowing them to interact with their service.
Is it possible to bypass KYC verification and buy, trade, and trade cryptocurrencies without it?
Let us investigate.
What is KYC?
To start, let’s examine KYC in more detail and discover why the cryptocurrency community finds it so appealing.
KYC, or “Know Your Customer,” is a set of guidelines intended to help financial institutions verify the identity of their customers. It can also be used to assess a person’s potential risk factors and financial capacity.
KYC verification may include the following checks:
- ID verification (passports, driving licenses, and so on);
- Facial/biometric scanning;
- Address verification (utility bills, bank statements, etc.);
- Payment method verification.
The KYC process is usually fully automated. In most cases, it will only take a few minutes for the device to check if you are a real human and if the information you entered is correct.
However, KYC may take a little longer if it is required after a transaction has been flagged as suspicious, but these cases are incredibly rare and will not affect 95% of users.
Why do Cryptocurrency Exchanges insist on KYC?
The increasing prevalence and popularity of cryptocurrencies have made them a haven for money laundering schemes and scams of all kinds.
KYC was a response to this and increasing demands from regulators, especially Western ones.
KYC protects cryptocurrency exchanges and other platforms from fraudsters who want to launder illegally obtained funds. It also helps governments regulate taxes and helps track stolen money.
All of these things are essential to maintaining the safety and security of the cryptocurrency market and are required for cryptocurrencies to reach a fully mainstream audience.
Why someone might want to avoid KYC in Cryptocurrencies
Although even with KYC, cryptocurrencies remain more private and decentralized than fiat currencies, many users prefer not to leave any digital footprint.
The verification process also serves as an additional (and sometimes very long and annoying) step that people must take before they can get their hands on cryptocurrencies. Not to mention, not everyone is comfortable sharing their data.
Fortunately, there are quite a few ways to buy and trade Bitcoin and other cryptocurrencies without KYC.
Best Cryptocurrency Exchanges Without KYC
These are some of the easiest ways to buy cryptocurrencies without KYC.
Peer-to-peer Trading
P2P, or peer-to-peer trading, is one of the most reliable ways to buy cryptocurrencies without KYC. After all, these platforms simply connect buyers and sellers without interfering in their transactions.
However, P2P platforms have some disadvantages: they generally have less flexibility in the type of cryptocurrencies that can be obtained, less liquidity, and longer transaction execution time.
There is always a high risk of being scammed out of your money; Always check the seller’s qualifications before contacting him.
Please note that some people may have fake reviews. Cash payments in person are usually the most reliable method of payment. Another popular way to pay for P2P orders is through bank transfers.
hodlhodl
The non-custodial P2P exchange platform facilitates transactions between users by transferring them to a multi-signature wallet.
They have a relatively high fee of 0.6%, but it is split between sender and recipient. They only work with Bitcoin.
Bisq
This fully decentralized peer-to-peer platform provides the ability to connect buyers and sellers of cryptocurrencies without KYC.
It is a software that organizes P2P transactions in a completely reliable, yet secure and transparent way. Bisq is also non-custodial and does not hold users’ funds, whether fiat or digital currency.
Cryptocurrency Exchange
Although most cryptocurrency exchanges have some form of Know Your Customer (KYC), it is not a requirement and most users will never have to go through the verification process.
Above all, centralized cryptocurrency exchanges remain the most convenient and easiest way to acquire cryptocurrencies, with relatively low trading fees.
KuCoin
Although KuCoin is advertised as one of the KYC-free exchanges, In reality, it is not.
Although they do not require KYC for purchases, users will need to pass verification to withdraw their funds. KYC is not required for withdrawals of less than 2 BTC per day.
Digitex
Digitex is one of the best cryptocurrency exchanges if you are looking for unverified purchases. This platform removed KYC verification in 2020 after a data breach.
Decentralized Exchanges
While decentralized exchanges generally do not require their users to create an account or pass any type of verification, they do offer direct purchases of cryptocurrencies.
Alternatively, you can “buy” cryptocurrencies on these platforms through stablecoins such as USDT or Tron.
Uniswap
Uniswap, the largest and most popular decentralized exchange, has not implemented KYC verification.
This exchange is also supported by its UNI token, which is among the top 20 coins by market cap.
dYdX
The dYdX decentralized platform runs on the Ethereum network and allows users to exchange cryptocurrency tokens without external intermediaries.
Unlike many other DEX platforms, dYdX offers users a unique opportunity to open leveraged trading positions, meaning clients can deposit collateral and trade on margin.
This platform does not require users to go through KYC.
Other alternatives
Don’t want to use the exchange? That’s fine! There are alternative ways to buy cryptocurrencies without KYC.
Direct P2P
The best way to bypass verification is to buy cryptocurrency directly from someone else without intermediaries. It could be your friend, colleague, or like-minded cryptocurrency enthusiast on your Discord server.
Of course, it is difficult to trust people you do not know well, especially in the absence of reviews, but if you have a lot of friends in the cryptocurrency community, this method will be the best option for you.
Just make sure you never send your money to people you don’t trust, and never send large amounts unless you have some sort of security (like standing next to your friend and breathing on their neck while they send you those bitcoins).
Bitcoin ATM
You can also use Bitcoin ATMs to buy cryptocurrencies without KYC. However, keep in mind that some of them require you to go through a verification process.
They also tend to have higher trading fees and are often surrounded by surveillance cameras, making them significantly less private, even without KYC in the picture.
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Disclaimer:
Please note that the content of this article is not financial or investment advice. The information provided in this article is solely the opinion of the author and should not be considered an offer of trading or investment recommendations.
Regarding the accuracy, dependability, and completeness of this information, we make no guarantees. The cryptocurrency market suffers from high volatility and occasional arbitrary movements.
Any investor, trader, or casual user of cryptocurrencies should consider multiple perspectives and be aware of all local regulations before committing to an investment.
