Topic: Kyc for accounts or wallets (Read 460 times)

for bitcoin storage wallets I have not found registration using KYC because they have implemented a special security such as prasa and privatekey, but for accounts on exchanges of course they will ask us to do KYC because every exchange they must know every user so that when fraud occurs when making transactions they will be easier to find the perpetrators, Unless they are hackers who hack every asset that exists, so it all has its own purpose even though we have to use our personal data, so it has all become a rule for user security.

He misunderstood about wallets and online accounts which can be accounts on centralized exchanges or on wallet provider platforms.

If you use a third party wallet provider service and that wallet is custodial, they can ask you to do KYC. If you don't do KYC, you have no option than leaving their platform and abandon that wallet.

Nowadays, it is more confusing as some wallet providers eventually deploying new products, they are like some in one, wallets and exchanges but if they are a centralized service and their wallet is custodial, KYC is very possible to be enforced.

Like Blockchain.com wallet that was only a wallet but they expanded their service and you can trade on Blockchain.com too.

Custodial vs. Non Custodial Wallets - "Not your keys, not your coin" Explained.

I think you are mistaking wallets vs exchanges.

Based on my experience, online wallets do not ask for any KYC documents. They only serve as a "wallet" for you to store your BTCs and to transfer to another wallet or a designated exchange.

Exchanges, on the other hand, are websites or applications that lets you use your BTCs for different purpose. You can also transfer your BTCs to another wallets but the beauty behind some exchanges is its convenience. You can exchange your BTCs to your local currency or even transfer it to your banks or other modes of storage.

This is the reason on why majority of exchanges ask for KYC documents due to the features they offer, which are not offered on wallets.

The wallet does not have a KYC but the exchange has. Seems like you are referring with the exchange in your statement. Exchange use only to change your coins or fiat currency into crypto currency and this not serve as a wallet people want to use the exchange as wallet so they can bought immediately a coins they want once get into the dip but at the end we can not deny the exchange can do anything they want and if they want to close or rug they can take our funds. Reason why we didn't encourage the exchange as a way of wallet. You don't have the private keys.  It's their money not yours until you have the full control of it.

I guess that's why OP confused. Normally there is no KYC process for Bitcoin wallets but centralized exchanges started to develop apps that enable to buy/sell/trade coins so OP think those are wallets as well.
You don't need to do KYC to use crypto-currencies unless you are in a centralized system such as Binance app. Newbies should learn how to use crypto-currencies and know which exchanges are secure before giving their ID's on apps.

A good open source wallet should never ask for a kyc and should always give you the ability to safely store your private keys.  The kyc is part of services such as exchanges or custodial wallets that should always be avoided by a good Bitcoiner who knows how the protocol works.

Some wallets require KYC, but not for holding and receiving coins, obviously. It's required for buying or selling coins directly in the same app.

I will never use a KYC wallet for my main bitcoin hoardings. I use wallet.dat with a passphrase on Bitcoin Core. Good luck getting me to KYC those coins. I understand exchanges requiring you to do it due to regulatory pressure but always hold your own coins in self custody (nobody else should know anything about those coins).

Little miss understanding from OP topic and regarding his account level we are understood about his mistake can't differentiate between wallet and exchange account. Actually wallet is not required for KYC like using trustwallet, metamask and many kinds of wallet exist right now. But need or required KYC for exchange market account like Binance, Huobi and several local exchange market, but for the beginner if worry about their document publish due upload to exchange market for KYC still have exchange not required for KYC like Kucoin.

Have thousand way for beginner if difficult for KYC their exchange account, check with exchange without required and sell crypto assets trough third party are trusted without directly withdrawing to bank account by local exchange market are required with KYC.

I have never heard of such KYC wallets too but it is only possible to do with custodial wallets. Like you don't have keys and if you use their wallets, you have to follow their requirements like using centralized exchange accounts.

Wallet KYC is impossible with non custodial wallet as you can create your wallet offline, airgap, nobody else knows what private keys you have.

Why KYC is extremely dangerous – and useless

My thoughts exactly after reading through the thread for a while and still kept seeing the same idea as in quote repeated across the write up!

OP isn’t really placing a significant difference between wallets and exchanges, sort of interchanging ideas between them both. I don’t know of any wallet that requires KYC to operate. They don’t even require you giving it a username. Naming your wallet is possible on some wallet apps but, it’s largely optional.

Should you be storing or hodling your coin on an exchange, I won’t say your doing it wrong but, hope your believes help you.

Two sides that are interrelated and cannot be avoided for an account then to do WD you still have to have KYC. Indeed, as you mentioned above, it is very important for individuals to maintain private data, even if it's just an ID card and that's still not bad. If the platform that we have chosen is KYC which is requested for a passport, wow, that's a different story.

I have never heard of any kind of wallet which requires KYC?

Not only would that be completely against the point of decentralization, it would be a wallet that nobody with a brain would want to use. Nobody wants to give away their government documents away so freely. Remember, those documents can be used by identity thieves to take out loans in your name or do worse things. Even KYC exchanges are nowadays frowned upon and rightfully so. We have absolutely no need for centralized platforms for cryptocurrency. The only use for them is convenience in buying and selling. But is that convenience really worth giving away your sensitive documents?

I think everyone should stay away from KYC. There are better alternatives.

I think you are referring to a centralized exchange where one have to pass kyc in other to purchase and transfer bitcoin in a larger quantities but there are some of them that do not need kyc except you want to trade on Future, margin or even p2p trading. All these required kyc for you to be able to trade freely. Cryptocurrency wallet such as Electrum or Trustwallet doesn't need any of the kyc you made mention rather we should be very careful given out our details to some centralized exchange. I think more reputable people already said their views.

I can't imagine if, in the future, hardware wallets, paper wallets, mobile wallets, and web wallets will ask their users to do KYC because that would not be in line with the idea of Bitcoin, which is anonymous. Crypto users will reject it and look for wallets that don't require KYC. Maybe what @OP meant was doing KYC when using a wallet on a centralized exchange, which has become normal for centralized exchanges.

For this reason, Bitcoin users are better off using separate wallets from exchange wallets to store their Bitcoins so that it will be safer and easier to control. @OP meant to warn us all always to be careful where we store Bitcoins and other cryptos and if we don't want to do KYC, keep Bitcoins and other cryptos in personal wallets.

One thing @OPO needs to understand is that if you use a centralized exchange, you have to do KYC even though there are still exchanges that don't ask their users to do KYC but later, the exchange will be required by the regulator. And if you don't want to store your crypto on an exchange, you can use a hardware or software wallet. It will be safer because you don't have to worry about hacking problems unless you can't store the wallet properly.

That can't happen. Government can ask us to hand them over all our previous, present and future addresses so they can register them under our name. There's Tor for that. Now obviously, there's another question.. how many would risk not listening to the government? I think enough people. If the moment comes where you're obliged to tell the government which addresses you own, I'd imagine there are many more things they'll try to break and monitor such as privacy and other personal stuff.

I'd 100% be using Tor to avoid such regulations because by then we're gonna be under a very scary and creepy governance. Orwell would be the closest thing you can get to that. So who cares anyway? It could mean "freedom" would be less free than prison, lol.

Back to the subject, they just can't impose KYC for wallets. Even if they try, remember Electrum and other similar wallets are open source which means a no-KYC fork would appear immediately. Worst thing, we start going back to using previous versions of the wallets. KYC can't be imposed on the network, they can only try to scare you to stop using BTC the way you should. And they'll probably try it, but it'd never work - remember BTC was initially created to be a peer-to-peer currency. If such anomalies happen because of the government, we'll just go back to what BTC should've been anyway.

It feels like the regulatory authorities and us are stuck in a perpetual game of cat and mouse. Bitcoin was designed from the ground up to be a completely decentralised and anonymous digital currency. Still, here we are, going through the motions of KYC checks for cryptocurrency wallets. I don't like to admit that, but I think you're probably right. Given the worldwide push for rules, it may not be long until wallets also require KYC.

It seems excessive for exchanges to demand confirmation of funds, right? But they're the ones attempting to follow the rules so they don't get in trouble with the authorities. It's difficult to predict how government inspections will go. Perhaps they are taking place unseen to the public eye.

But I think we as a society have a duty to resist these intrusions into our financial privacy. Crypto was supposed to be our safe haven from these oppressive restrictions, but now it may be one of the first things to go.

Wallets such as hardware wallets, paper wallets, mobile wallets, web wallets etc does not require KYC. You are only required to write know your seed phrase for safekeeping. You get to perform KYC when you are using a hot wallet which are centralized exchange wallets.

The wallets I mentioned above do not have terms and conditions, it is only centralized exchanges that gives you terms and conditions. Op, I can see a lot of gap in your knowledge. Instead of creating topic like this and dishing out advice, I would advise you take some time to read more and be equipped with a lot of information about Bitcoin and other crypto-related stuffs for your own good.

Wrong, Bitcoin is pseudonymous not anonymous. Although leak of privacy can put a danger, but you need to know if most of people not consider privacy is important. Take a look with how many people are use centralized exchanges, how many people send their KYC on shitcoin project to get airdrop, how many people are posting their luxury lifestyle in their social medias etc, if they consider privacy is important, they wouldn't do that.

It's up to every person to consider privacy is important or not.

This makes good security of KYC and stops duplicate bad steps from happening. But you be careful to send KYC or it's an Airdrop. your data can be an option for them to make you lose in the future.

KYC can be required for accounts as i can say specially centralized exchanges will ask KYC (for low amount trading still you can use some exchanges without KYC) but you do not need to KYC for non custodial wallets, It can be hardware wallet or software wallet, your assets will be safe.

Speaking of KYC, I've encountered XGo crypto platform today. I really liked how fast was the KYC process there.

It's for the account not for the wallet.
KYC (Know Your Customer) is the initial requirement for users who want to register an account on the exchange. Multilevel KYC levels with different purposes are designated as withdrawal limits.
Not all exchanges require KYC, but most exchanges require KYC like the exchange operating in my country.

Asset owners already know that keeping Bitcoins is not in exchanges, but in wallets.
Do you already have a trusted wallet? if not, use Electrum and HW.
Privacy and security are the main elements that need to be considered by asset owners.

Don't store assets online, theymos says.

      -   The only ones that require kyc are usually regulated businesses such as Binance, Houbi, as long as they are centralized that have submitted requirements to the government in order to operate legally regardless of the country they are in.

That's why if you're going to hold Bitcoin or any cryptocurrencies, the non-custodial, or hardware wallet is still really good and include the Electrum or sparrow wallet.

You are quite confused with the terms wallets and exchanges. Let me explain you 2 things -

1. Wallet: It holds Bitcoin or any other cryptocurrency. You can send/receive from here.
2. Exchange: They hold Bitcoin or any other cryptocurrency for you. You can send/receive/trade on an exchange.

now there are multiple type of wallets:
1. Hardware Wallet
2. Software Wallet
4. Paper Wallet

Yes that is what custodial wallet means - it means someone else stores your bitcoins and not your PC. So they can do whatever they want with it including block it behind "enhanced verification" or loan it out to ill-fated lenders like Voyager or 3AC, and usually in their terms of service you will probably find a clause that says that they have no obligation to give you your money back if A), B), or C) happens.

I was wondering too because it is never possible for a self custodial wallet to demand for KYC and personal details only CEX could demand for such and if any the self custodial wallet does that, just as you have said, there is likely a possibility of that wallet being porous and it would not be advisable to make use of such wallet for the safety of ones funds.

Storing long-term on a Custodial wallet is risky, it is an account that can be frozen or hacked at any time.
Long-term storage is of course a Non-Custodial Wallet that will be safer because it has full control, no KYC, no third-party interference.

Tai chose a secure Non-Custodial Wallet that does not have a seed phrase extraction feature.
Because it will only be a useless Non-Custodial Wallet.

Your transactions always are monitored on Bitcoin public ledger and can be checked on block explorers.

You only have to do this when you create your online accounts, exchange accounts to store your bitcoins. You don't have to read their Terms of Servive to know you don't own private keys or mnemomic seed. During the process of account creation, you should realize that it is a custodial or non custodial wallet.

Do your research before creating accounts is good so you will not waste your time.

If you use non custodial wallet, you don't have to register any information, no KYC. Just pay attention to research that wallet is open source or close source. You should use an open source wallet.

KYC is required for wallets on CEX (centralized exchanges).
If we don't want to have KYC procedure, we must choose non-custodial wallets.
There are some alternatives for non-custodial wallets:
1). Software wallets
Ex: Metamask
2). Hardware wallets
Ex: Nano X
3). Paper wallets

For a big number of Bitcoin, non-custodial wallets are the most recommended.

Take a look:
https://www.coindesk.com/learn/custodial-wallets-vs-non-custodial-crypto-wallets/
https://www.ledger.com/academy/glossary/non-custodial-wallet

Agree. It is actually an account and it is not a private wallet. Custodial wallets or wallets on exchanges can be a place to put Bitcoin in small number temporarily, but it is surely not a safe place for long term holding.

When talking of KYC for bitcoin wallet I have not heard wallet to store bitcoin use to have a verification of KYC before you can use it for bitcoin,  what I know concerning KYC is when someone is involve in investment platform and the person need to follow the instructions of the platform its when KYC is necessary, with your explanation its difficult to understand your point and what exactly you are saying, when reading your content its confusing to any point I miss out of understanding your point properly, as a beginner like me despite that I'm a little bit higher than you, you need read twice your composition before posting to cross check the sentence and the words rhyme to your poin

No one is getting your point, and for the record you never mentioned a custodial wallet in your opening post. If you are talking to beginners, try to be clear about what you are saying, at least.

Exchanges that force us to KYC are to avoid fraud, track money laundering activities…and above all, comply with government regulations.  they cannot function and exist without the permission of the government.  if you follow the recent information, the US government has also asked Kraken to provide a list of investors for them to tax.  If Kraken resists, it is understandable that they will have their business license revoked.

Regarding KYC wallets, I agree with you, it will be done in the near future is inevitable.

Most likely. I haven't come across any wallet that requires KYC or extensive requirement of providing personal information.

And it's not necessary too, the main point of having wallets is to make sure that your funds are in your person. Cold wallets do this by making sure that you can carry them or keep them somewhere safe, shut off from the internet and secured as much as possible. Hot wallets do this by requiring you to create an account with them, complete with seed phrases (which basically acts as your digital profile information anyway) to make sure that it's really you who's accessing the account.

If a wallet ever required KYC in the future that's not a movement towards better security, it's a movement towards collecting data to sell to advertisers as there's no need for KYC at all for wallets.

Leaving aside the confusion created by the OP regarding kyc wallets, something I've never heard of. One thing I've been thinking about for a long time is that the governments have mandated that any company that handles other people's money should ask those people to do kyc, so I'm wondering how long it will be before governments start chasing the wallets so that they start forcing their customers to do kyc, because from what I see it's a matter of a few years before we start seeing wallets asking for kyc, unfortunately the damn kyc is here to stay

and every day the situation tends to get worse, I myself am shocked when certain exchanges ask for proof of origin of funds, even being in a bitcoin market, such exchanges want complicated documents, but the most shocking thing is that I do not see any government doing inspections in the exchanges, so I don't understand why they are so hard on people when they ask for kyc, has anyone here ever heard that a casino or exchange was fined by some government because they didn't ask for kyc? Anyway, I hope that at least wallets are not forced to ask for kyc so soon

There is no non-custodial wallet that will request or require their the user to pass kyc verification, except their counterpart like centralized exchanges, custodial wallets and so on..

If at any point a wallet that is supposedly a non-custodial wallet starts asking or suggesting their users to pass kyc verification to probably enjoy some premium services, then know that such a wallet is a custodial wallet and also have a high risk of being hacked, there is even the possiblity of the builders of the wallet having unrestricted access to your fund since they may likely have access to the private keys.

Your post confirms that still many people are not able to distinguish exchange accounts and wallets, you need to complete KYC for accessing an exchange whereas to create a wallet you don't need to provide any information, you can simply create your wallet and keep your private keys safe. So your privacy will be compensated only when you transfer funds from KYCed address to your wallet address since it will bring the connection between two and it will never be erased since every data on blockchain is available in a public ledger.

FYI, bitcoin is not really created to bring complete privacy while there are other cryptos has such characteristics but bitcoin is Pseudo anonymous.

Op, I was wondering if what you said could ever exist as to one undergoing KYC for their private owned wallet. I do not think that would be feasible because any company that decides to do that would definitely use their wallet themselves but I know for sure CEX are the ones who conduct KYC as they are mandated to do so and are custodians if all wallet keys on their exchange.
So if you want to stay out of KYC then move your funds and assets out of CEX if you have them there or better still avoid CEX .

OP this notice is a bit non-descriptive.  The kyc does not affect any personal wallet where private keys are held such as electrum but is required by a series of services such as centralized or custodial wallets.  So I agree with you but before buying Bitcoin I suggest you get a good education and after learning the basics use open source wallets.  In any case this forum could help.

You are definitely describing a Centralized services such as exchange and few custodial wallets that stored KYC information of user. Using this kind of service will surely danger your asset since you are not holding your wallet keys when you are storing assets on custodial wallets. Privacy is not your main problem anymore once you use services that requires KYC.


it’s very hard to be completely anonymous on Bitcoin most importantly if you are converting fiat to Bitcoin or vice versa since most the exchange requires KYC and there’s only few decentralized P2P exchange that doesn’t require KYC but with huge price spread than the regular market price. I  think you will have no problem for not being complete anonymous since no one will monitor your transaction if you are not doing illegal. Government or someone will not waste time watching someone wallet without any valid reason.

One attribute they will make you learn in this forum is meekness and the ability to accept correction without offense. If you are here to learn then you should be teachable because that's how you will learn. Don't be offended when you are corrected because nobody knows all.

OP when you open an account in an exchange they give you an address. That address can be used to receive and send coins from or to other addresses. But you don't have control over the wallet that generated the address because you don't have the keys. The exchange keeps your funds so they might decide to release or hold your funds at any point. The exchanges are custodians of your assets because you don't have the keys. But when you have the keys to your wallet and no third party is holding them, you are using a non-custodians wallet. No third party is in custody of your funds. You should also know that there are closed and open-sourced wallets. The best ones to use are open-sourced wallets.

While software wallets whose source are verifiable and open-source are entirely safe to use but on the other hand hardware wallets such as Ledger require us to do KYC to use quite a few of their features and for receiving the wallet on the customer end. Some libertarians such as Lopp has went to greater extremes to own a house to receive hardware wallets and to do the KYC. Through this way, they should be able to maximize their anonymity thereby feeling safer from hacks which has happened in Ledger at the past.

I would recommend if someone is planning to own a large sum of Bitcoin, they should be opting out the Lopp's way of hiding one's identity as we can never be sure or trust centralized companies such as Ledger, Trezor or Keepkey with our information. When Ledger's email and address database leaked, many individuals who had purchased wallets from the website were contacted by scammers and were threatened in the process. On top of that if you really want to maximize your anonymity and be safer from hacks while dealing with large amount of bitcoin, it would be better to use open source OS's such as Linux too.

Nowadays storing seed words on cloud storages has been increasingly dangerous as the company providing such services has the ability to always work towards governments and seize our digital assets.

It seems that the original poster (OP) may not be familiar with non-custodial wallets, as he haven't mentioned them in their post. The main point of your topic is to avoid using custodial wallets altogether, which eliminates the need for KYC (Know Your Customer). Centralized exchanges and custodial wallets typically require users to submit their KYC information. It would be beneficial for you to expand your knowledge about different wallet systems.

Even the so called closed source crypto wallets don't ask for KYC verification unless the wallet company is also running a crypto exchange, I know about Luno wallet which is also a crypto exchange and it's centralized, since the wallet and the exchange are running in the one single app makes KYc verification important.

If any crypto wallet is asking you for KYC it's wrong, do not use such crypto wallet to store your asset, closed source wallets and non-custodial wallets are big red flags, something you must avoid at all costs.

if there will be kyc to BTC wallets like Electrum, users will definitely decline faster than they know. it would mean the team is compromised.
if its possible for the wallets to be compliant if the government mandates them, i think those close-source btc wallet companies will comply with what government asks. we are living in crazier times. who knows what could happen but for now, we are lucky to have no btc wallet that as for kyc.

The so called exchange accounts creation for thier users thereby being generated a custodial wallet makes it appears as if they are really wallet, but on a real sense they can be termed wallet under custodial wallets but we often refers to this categories as not wallet since they have the private keys in their custody to the assigned wallet even though the actually currency is stored on the blockc and not on the exchange account created.

Usually, it's only the centralized exchanges that ask for a KYC compliance but if it's with the typical wallet that we use such as Electrum, it doesn't really ask for a KYC.

Well, it's up to the user if he's going to be obliged and comply with these KYCs because if you don't. Your funds are going to be held and delayed in these platforms.

It's true that we should be the one that are holding our keys but upon transfer to those centralized platforms, we don't have it anymore.

I guess you really need to be clear in your post, or try to understand different kind of wallets,

url=https://bitcointalk.org/index.php?topic=5173370.0]Custodial vs. Non Custodial Wallets - "Not your keys, not your coin" Explained.[/url]

And as others have said, maybe you are referring to custodial wallet, like what you find in exchanges or any other services like gambling platforms.

My thought as well! I haven't come across crypto wallet that requires KYC before. It seems OP is mixing things up to confuse himself and the readers as well. It's really funny seeing newbie advising newbies but that doesn't matter anymore since some of these newbies accounts are being operated by some high rank members as alt.

Creating post is not actually a bad idea because Practice makes one to be perfect. Maybe OP finds it difficult to locate a thread that's a compatible with what he wants to say and decided to create a thread. Op, You should embark on research before you attempt to advice others.

Same here, but I think that the Op is confused about something here. Kyc(know your customer) is mostly used by exchanges or crypto accounts and not wallets. Using kyc exchanges sometimes is a choice that depends on  the individuals goal and specific use cases eg business purpose. and such for someone new to the crypto verse, the non-custodial wallets are usually suitable since you just want to store or hodl  cryptocurrency.

Since hardware wallets are expensive, it is sometimes adviced for users to use a non custodial wallets which require no kyc, and is less expensive. you just  have to download from legit source (play store, or their original website) and then install on your device with few mobile data.
It is not advisable to use kyc required platform as it puts your identity at risk. Here is a thread that explains fully why you should avoid kyc
Why KYC is extremely dangerous – and useless

OP, you should learn first instead of  advising newbies like you. Creating topics shouldn't be what must be done at your level,knowledge is what you need for you to grow. It is only centralized exchanges that asks for KYC and you should also understand the the wallet that you feel is yours on their platform is theirs because they are in charge of the private keys. Sorry for the criticism mate

KYC and Bitcoin wallet? To be sincere I do find this topic funny.

Op, you should start by researching the difference between wallet and exchanges... I guess what you read about or referring to is an exchange and not a non-custodial Bitcoin wallet.


Read my entire post, I made mention of "non-custodial"

Wallet account creation?.
If you need a wallet avoid platforms (exchanges) what I know about is custodial and self custodial wallet. Those that gives you full control over your wallet, you have your key and phrase and they are open source which their code could also be verified by other developer.

For security reasons we should avoid custodial wallets, checking their terms and conditions might be useless because they can be change them when ever they have your money under their control, so just avoid them even when they say no KYC, trusting a 3rd party with your holdings is a very risky thing to do.

Noncustodial wallets do not require KYC, he is referring to custodial wallets and custodial exchanges. Both are not even wallets, they are accounts.

Are there really any wallets that require a KYC procedure in order to be used?

Aren't you talking about accounts on exchanges that require KYC (like Binance - Coinbase etc.)?

According to my Bitcoin understanding Bitcoin is an asset that should be owned by an owner anonymously  now my point here is Bitcoin investors especially newbies should be very careful with wallets and crypto accounts that requires kyc for verification most newbies may be shocked or confused but the reasons are for your safety
 kyc puts you personal information and privacy at risk it also gives ability for your transactions to be monitored.
So please before making wallet registrations always read through terms and conditions as well as privacy policy
Or rather get a hard ware wallet especially if you have large amounts of Bitcoin or other crypto currencies

Part of the Bitcoin idea was anonymous identity of users
 so as an asset owner you should support this notion
DON'T FORGET TO KEEP YOUR KEYS SAFE MATE!!