Know Your Customer (KYC) verification is widely known as an identity tool to authenticate users and a vital component of Anti-Money Laundering (AML) regulations. This procedure can apply to a number of different services, not only crypto-related ones. Still, crypto payment tools also often utilize it since this is a simple and reliable way to validate users and mitigate fraud. While it isn’t a compulsory element in crypto exchanges, most fiat-to-crypto and crypto-to-crypto exchanges choose to stick to it to build higher transparency with a customer and lower risks of financial crime. Nevertheless, you can come across a crypto payment gateway without KYC.
But why would they avoid the KYC verification procedure? This can happen for several reasons. First and foremost, conventional KYC is somehow on the pricey side. The cost concerns registering with regulatory organs and paying for verification processes. In many cases in the UK, registering at the Financial Conduct Authority (FCA) costs nearly $7,000. The high price of traditional verification is also explained by involving third parties when sending customer documentation for checks.
In addition, many crypto entities do not adopt the procedure because of a high client dropout rate caused by long waiting time, which can take up to 30 days. Other arguments against it include specific data security issues with KYC and failure to scale up for the growing regulation.
All in all, not everything is as black and white as we are used to seeing things. With this being said, businesses have to know what they can do to eliminate risks when using no-KYC crypto pay services.
Pluses of Tools for Crypto Without KYC Verification
Before jumping in, it is important to realize all the pros and cons of exchanging crypto without KYC. Now, a crypto tool without this kind of verification doesn’t mean you will definitely get in trouble. In fact, it can just mean you will share less personal data and preserve your right to privacy. As a business, you can send and accept payments through a crypto payment gateway without KYC and skip disclosing your identity and putting any sensitive data at risk.
In addition, KYC-free exchanges often offer a much wider range of crypto tokens. They tend to get early access to new coins, which normally become available on regulated exchanges later. Such services are also better for international transactions.
Top for Decisions Businesses to Land for Reducing Risks Using a Crypto Gateway Without KYC
Getting down to specific steps to recognize a crypto gateway without KYC that is still worthy of your attention, let us show you some of the points. Here is what you can consider doing when seeking to take less risks.
- Look for a good track record.
When reviewing tools, make sure to check if each of them has ever had a record of hacking. Take your time to read more about each tool, its partners, and services it claims to use, as well as reviews and experiences of others.
2. Choose non-custodial platforms.
If you delve more into the topic, you might already understand that a custodial KYC-free service is just easy prey for those desiring to hack them. Many of them can even find out your location, real name, and contacts just because custodial platforms are more vulnerable to attack. Just to remind you, a non-custodial service doesn’t let third parties hold your private key.
3. Stay up to date.
Remember to keep an eye on updates because the service with no KYC, in the beginning, doesn’t always stay the same, and things might change with time.
4. See if the tool has easy withdrawals.
The service’s policy shouldn’t be directed to complicating withdrawing money for users. In other words, you should have a sufficient upper limit. High limits, low fees, and transparency about sending and receiving digital funds are the keys.
5. Check if a tool’s technical features comply with your instruments.
This might be very important for big and small businesses. Even though not closely related to payments, this can save you a lot of money and nerves. So, check if a tool of choice is actually compatible with the software you use unless you want to change it, which also creates difficulties. In this way, your customers will be able to pay with no issues and won’t be turned away because of technical problems.
To sum it up, not all crypto sites without KYC can be treated equally. They can be a good option if you are concerned about privacy and security and want to skip intrusive verification procedures. Simply keep in mind these practices we shared above and view each tool with caution and wisdom.
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