KYC is a necessary procedure in most major exchanges to prevent and protect users from criminal activities. Here's how to properly do it in Gate.io.

Cryptocurrency offers easy access to innovative financial products and services, allowing blockchain users to transfer funds directly to each other or via crypto exchange platforms. The system claims to be fully decentralized and separated from third parties, so many crypto holders believe that they are protected from malicious activities.

However, that isn't necessarily true.

All crypto transactions are generally anonymous and take place in seconds. This makes the environment certainly attractive to criminals seeking to slip through the gap and snatch the opportunity to do their dirty work. In fact, a report by Chainanalysis has revealed that illicit crypto activities hit an all-time high of $14 billion in 2021 – a 79% rise from the previous year's $7.8 billion.

As a result, it is now more important than ever for crypto exchanges to address their Anti-Money Laundering and Countering Financing of Terrorism (AML/CFT) compliance responsibilities and create a safe space for their customers. One of the required actions is to implement the Know Your Customer (KYC) processes in order to know who their customers really are and how they are using their services.

How to do KYC in Gate.io

 

What is KYC in Crypto Exchanges?

Know Your Customer (KYC) is the process of identifying customers before any transactions are made. This is quite a common procedure in various companies including crypto exchanges and other crypto-related financial institutions. It's basically the foundation of the AML/CFT compliance regulations all around the world and is used to prevent criminals from evading the AML/CFT controls. By having a good understanding of their customers, exchanges are more likely to be able to detect customers that are misusing their service and prevent criminal activities to take place.

The conventional KYC process typically involves the following measures and requirements:

 

Identity Verification

Crypto exchanges must have a clear idea of who their customers are individually. Thus, they must obtain and verify identifying information of their customers, including their full name, address, and date of birth.

Some KYC procedures also require users to provide additional proofs of documents such as government-issued identification like a passport, proof of residency, and/or social security number. Checking and verifying these documents may take longer than usual, but it's certainly an important step to building an accurate risk profile.

 

Customer Screening

Before letting customers make any transaction, it's important to do a thorough screening to ensure that they don't have a high probability of being involved in money laundering activities. This includes making sure that they are not subject to international sanctions or Politically Exposed Persons (PEP).

 

Customer Monitoring

Exchanges should also monitor their customers' transactions from time to time and look for signs of criminal activity, which can be obtained by looking at transaction patterns or transactions involving high-risk customers and locations.

 

Adverse Media

Exchanges should also screen adverse media to detect their customers' activities because most of the time, customer risk profiles are published by adverse news stories before they appear in official sources.

 

Why is KYC So Important?

It is important to note that KYC procedures are not standardized everywhere. This means that some exchanges may require a full set of due diligence, while others may not require it at all. Crypto businesses that don't implement the KYC process are more vulnerable and usually targeted by criminals. After all, the main purpose of applying KYC is to help companies better understand their customers so they can prevent criminal activities from happening.

Apart from security matters, KYC can also open new opportunities for the business. Most crypto holders understand the importance of protecting their funds, so they tend to choose reliable exchanges that use the KYC process to verify the identity of their customers. Nowadays, KYC can even be done in under an hour on certain exchanges, so it's very convenient.

Lastly, the KYC procedure, along with other AML/CFT regulations, has been a huge help in making the world of cryptocurrency more secure, transparent, and compliant. Most major crypto exchanges use KYC to protect their customers these days, so it's definitely a great improvement for the safer crypto space.

 

How KYC Works in Gate.io

As mentioned, KYC procedures are not universal, so the practice may vary depending on the exchange. Gate.io is one of the widely known crypto exchanges that has been using KYC to protect customers for several years now. Therefore, all Gate.io users must complete the KYC verification process before they can trade, deposit, or withdraw cryptocurrencies and participate in any Gate.io events.

The KYC process on Gate.io is actually pretty simple. Here's what you need to do:

 

1. Head over to Gate.io's official website and log in to your trading account. Click the top-right profile icon and choose "KYC (ID Verification)". Then, choose "Individual" and click "Verify Now".

Step 1

 

2. For the KYC1 verification, simply enter your personal information in the required fields and click "Confirm and Submit".

Step 2

 

3. Once your KYC1 is verified by Gate.io's team, just click "Verify Now" to continue to the KYC2 step (verification plus).

Step 3

 

4. Insert your information in the required fields and upload your national ID card as requested. Click "Confirm and Submit".

Step 4

 

5. You will be redirected to the face verification page. Don't forget to read the notice carefully before proceeding further. Once you're ready, click "Go to Facial Recognition".

Step 5

Step 6.1

 

6. If you find the face recognition not working, you can try to submit gesture photos. You'll need to submit a total of 4 photos of certain gestures that show the last 4 digits of your UID. Make sure to read the instructions carefully and make no mistakes.

Step 6

If you're still unsure, you can see the preview samples of photos of all gestures by clicking the "View All Examples" button in the top right corner. After uploading the photos, click "Confirm and Submit". Now you just have to wait for the exchange to approve your submission, which may take half an hour up to 12 hours.

 

Aside from implementing KYC procedures excellently, Gate.io is also known for its innovative feature for crypto traders, one of which is the copy trading platform that allows clients to copy trades from more experienced users.