1. Anti-Money Laundering (AML) & Counter-Terrorism Financing
Identity verification (KYC) helps exchanges prevent the use of accounts for money laundering, illegal transactions, or transferring funds for malicious purposes.
2. Protect Users and the Platform
- Prevent scams, account hijacking, or fraudulent transactions
- In cases of disputes, account suspension, or access resets → KYC allows the platform to accurately identify the real account owner.
3. Increase Transaction Limits
Users who have not completed KYC are usually restricted:
- Lower withdrawal limits
- No access to P2P trading.
- Ineligible for Launchpad, staking, or API usage
4. Comply with International Regulations
- Exchanges must comply with financial laws in various countries.
- Without KYC, they risk fines or bans in regions such as the U.S., EU, South Korea, etc.
5. Transparency and Trust
Platforms with KYC in place:
- Can cooperate more easily with banks and financial partners
- Gain greater trust from users and investors