What does KYC mean and why digital currency exchanges must have KYC to open an account!
In the field of finance and buying and selling digital currency, KYC or Know your customer is an important process that companies or financial service providers use to verify and confirm the identity of users. Kyc is a very important standard for digital currency exchanges (crypto exchanges) to prevent fraud, money laundering and other legal issues related to online transactions.
What does KYC mean?
KYC or Know your customer is a process in which companies or financial service providers require users to correctly verify their identity through the presentation of important documents such as ID cards, passports or driver's licenses. The purpose of the verification is to ensure that the person opening the account is a real person and has no intention of committing illegal activities such as money laundering, financial support to terrorist groups or other illegal activities.
Why does the digital currency exchange market require kyc to open an account?
The digital currency exchange market uses kyc to make sure that users are individuals and to protect the security of digital transactions. Also, kyc also helps prevent fraud, personal information theft and money laundering activities as a risk in the highly volatile digital currency market. The main reasons why the digital currency exchange market needs KYC are:
1. Prevention of Money Laundering and Money Laundering: Exchange markets that use kyc can identify and block suspicious transactions, which helps prevent money laundering and money laundering.
2. Comply with the laws and regulations of the digital currency exchange market according to the laws of various countries that stipulate that users must confirm their identity according to the kyc standard in order to carry out legal transactions.
3. Prevention of fraud and use of fake accounts: Using kyc allows the exchange market to verify users who try to open an account with fake information, identity verification helps to reduce the chances of malicious people creating accounts to use for fraud or fraud.
The required documents for KYC, the user must show proof of identity may include:
• People's card
• Passport
• Driver's license
• Proof of address such as water bill, electricity bill or bank statement
In addition, some exchanges may require users to take a photo of themselves with identification documents to increase the security of their accounts.