It is easy to convert your heroes into villains. And CryptoBridge has done just that by announcing mandatory KYC verification for every user on the platform. Starting October 1st, users on the exchange can deposit and withdraw tokens only if their KYC is verified.
As CryptoBridge is a decentralized exchange, such KYC announcement comes in as a surprise. However, due to technical and regulatory reasons, the requirement was published and enforced immediately.
- Technical reason: By making KYC compulsory, both the existing and new users can enjoy a safe trading environment away from illegitimate activities. Enforcing KYC verification stops manipulation from multiple accounts and money laundering activities.
- Regulatory reason: To meet the regulation set by the 5th EU Anti-Money Laundering Directive (AMLD5), CryptoBridge had to introduce mandatory KYC. The deadline was January 20th, 2020.
Previously, only non-KYC US citizens were prohibited from using the exchange. With this move, in order to continue using the services, every user on the platform should identity themselves through KYC.
CryptoBridge believes this is the right step forward. Not only is it adhering to the rules and regulations but also opening up the possibility of listing security tokens in the future.
The immediate move to bring KYC, however, has left a lot of users worried. Both deposit and withdrawal of tokens have been halted for non-KYC members. Tokens on the exchange are “stuck” unless your details are submitted and verified.
One of the popular Twitter influencer @Vella says “no warning” was given about this:
Even project owners will face issues as the trading volume may drop and users may leave. Graviex exchange, on the other hand, crafted a marketing strategy around this. They are willing to take any unhappy project owners from CryptoBridge to Graviex within 24 hours:
📣In view of #CryptoBridge strengthening KYC rules, we’d like to sustain affected coin Communities and offer to apply for Listing (put a link to your market on CB as a comment). These projects will have the fastest due-diligence (in 24h) and the most favorable terms of Listing. pic.twitter.com/BxbnOJfdM4
— GRAVIEX (@graviex_net) October 2, 2019