Topic: KYC warning to those new to crypto (Read 147 times)

In this post, I will be discussing KYC what it is why it is needed and when will it be asked for.

First I would like to start by saying that crypto & bitcoin is very private by design. One of the very reasons bitcoin and the blockchain was invented was to protect your privacy. After all, why should anyone know about what you do with your own money you earned yourself? KYC is ridiculous and countering the very core of crypto. Crypto was invented to stay outside the clutches of greedy government and banks. It is meant to bring financial privacy and even a tool of liberation. KYC is a threat to bitcoin but it won't destroy it or last very long.

They will tell you that it is to stop money laundering... The first thing you need to realize is that identity theft far outweighs the threat of money laundry. I mean who are we protecting here? Seems like those who ask for KYC are protected. We as ICO investors or bounty participants are not the ones who need to be giving out all this info, we should be protected. By handing out KYC left right and center is taking your power away from you and giving it to random ICO's.

One must also realize money laundry and tax evasion are not the same thing.

What is tax  evasion?

Every country has different laws but almost all countries require you to take personal responsibility for your own earnings. What this means is that at the end of every business year you will need to fill out a tax form. If you work for a company they could do it for you automatically since they get taxed themselves which includes your tax so your payment is paid after tax. If you work online you need to declare your earnings and loses in a government form which you fill out. Keep in mind not everyone pays tax and there are many grey areas. I shall expand on some areas involving tax.

Some people earn too little to qualify to pay tax and may or may not be required to fill out a tax form.

A good example of a grey area would be a waiter or waitress. The tips are paid in cash and by the end of the month the tips add up to surpass the minimum taxing of wages. In other words, if you pay tax when your earn 1k $ then they would be earning 2k $ , now the question is should they pay tax? I am unsure about that as it is a cash "business" Most people taht work at bars or places like that do not declare their earnings or pay tax.



Cryptocurrency is taxable??

Well not really... Does the government have a bitcoin address so I can pay my bitcoins to them? No.... And doing so would piss everyone off and kill bitcoin. To be honest, governments don't know how to approach cryptocurrency. Please remember that cryptocurrency was created by us out of advanced algorithms. It was not issued by the government or banks. We ourselves have given bitcoin a value. Please remember bitcoin is not like fiat. Fiat is backed by the government supposedly by gold (we will get into that another time). Cryptocurrency is not backed by anything and has no value other then the value we give to it. It is not connected to the government and is a private entity. I personally believe it can't be taxed. Not the traditional way anyway.
The only way you get taxed on cryptocurrency is if you convert it from cryptocurrency (that has no backing or value remember) into fiat which is not a private network like the blockchain. Therefore being fiat it is now connected to the backing of the government and has a value and that value is not in our hands like bitcoin is and that is why crypto inflates and deflates the way it does and fiat does not.

Remeber that cryptocurrency is run on a private network. When I say private I mean its run by the people not the government. We are the bank. You are in control of your own finances. The goverment cannot tell you how to store your wealth. You may do so as you wish. You can buy bitcoin or gold or anything. You could buy a whole lot of anything and that is your wealth because it has value. So you could keep your wealth invested in vintage cars or boats or whatever it is and even trade in it. After all if I trade you my car for your boat I don't pay tax on that now do I? I only pay tax if its fiat currency because fiat is controlled by banks and governments and if you use it you have to abide by their laws.


Now we get to the most important part.

KYC is used by government and banking institutes. Investment companies can also opt to use KYC. These banks and companies are registered for KYC and have an official KYC service that they use. The KYC service basically checks for consistent KYC documents so it can find fake ones. They don't really look a the info but it is stored. A bank or legit company that asks for KYC will also have a physical headquarters and be registered within their country for KYC through one of the many KYC services. They will also have a way to contact them and protect yourself should something go wrong.

So whats the problem?

Here is the problem. These ICO's require nothing to run. Funny how participants must give so much info about themselves when the ICO's owners don't have to. Is is not true that the people running the ICO could commit the most fraud? They often ask for KYC even though they have not done so themselves. They don't even register for a KYC service.

Many ICO's ask for KYC but have no way to check them since they don't even register for a KYC service. A proper KYC will only require you to fill it in once because it is registered with the KYC service and has already been passed. My question is, where is this KYC info kept and why are they asking for it if they not even registered at any KYC service. ONLY INVEST IN A ICO THAT USES A VERIFIED KYC SERVICE. Only the KYC service and you should see that info. You should not have to upload KYC to any service that in not an official KYC service because then they have got access to your info.


Many ICO's don't use official KYC services and thus have direct access and can view your personal information. So someone you don't even know on the internet is asking your for your money and your identity and you just going to hand over both? It is no wonder so many people lose their money.

Even some exchanges ask KYC, please do not think an exchange that asks for KYC is legit. Most are not. I use many exhanges and none ask for KYC and I have not lost any money there. There first time I use this on exchange called okex they lock my account ask for KYC and say strange activities are happening. Good think I never gave KYC because they scammers and stsole 0.03btc from me. This never happened at the other exchanges.


The worse KYC trick is when bounty hunters are asked for KYC. Is is not needed for bounty hunters and have you ever wondered why they only seem to ask for KYC after the work is done but never before?? How many bounties have you entered that don't mention a word about KYC then all of a sudden want it at the end?




Why should I care how bounty hunters are treated as an investor? Because it demonstrates how they treat people who have helped them and if they cannot be honest about a contract for a bounty hunter and not upfront but rather ask KYC only after the work is done then how can you trust them with your investment?





The danger of KYC?

So you think KYC is safe and its no problem giving out who you are what you look like and even where you live? How often have you given your phone number to shops and companies only to get spam?? That was only giving your number nevermind everything else.

Allow me to scare you with the truth.

Let us indulge ourselves a bit into the mind of a criminal scammer and thief.

Let us make easy money. How to do it? I shall put it in steps.

1. Create a token.
2. Create a bs story for why your token exists
3. Run a bounty and make even more money by asking for KYC (you can end up keeping over half the amount owed to people which is big money for doing nothing)
4. Allow people to upload their KYC to your personal ICO site to your personal server which might have little protection.
5 After burniing remainging tokens to seem "legit" you gain all the tokens you never gave to bounty hunters.
6. When asked if your team passed KYC say nothing. Noone knows who I am but I know who they are and even where they live.
7. Sell the KYC info or use it myself to commit whatever crime I feel like.
8 Rinse repeat
9. Very little chance of being caught.

Here is another very easy way we can scam people

1.Fake airdrop that asks for KYC
2 steal all info and sell it and make a lot of money since one KYC can cost $150 (go google it you can buy KYC)
3. Get away 100% free with very little risk.
4. Rinse repeat

Now we stop thinking like a criminal and think of things from the side of the person giving there KYC.

1. A stranger knows who you are.
2. There is no guarantee your info is safe and no legal commitment. (A bank has a legal commitment to protect your info and their reputation. ICO's do not.)
3. No guarantee you will even receive your tokens.
4. If you are scammed or your info is stolen there is nothing you can do. Since the project team never did KYC you don't even know who they are. You lose your money.
5. Constant worry if your info is safe.

So guys how many ICO's do you think it will take before your info is stolen?

10? 20? 30? I am sure after giving your info out 50x it must get stolen surely. Eventually, it will if you keep handing it out.


I will be making more posts about naming and shaming bounties that were not paid out because of hidden conditions such as KYC. It is nothing more then an excuse to not pay.



Stay safe guys and never give your personal info to anyone. You have no idea whats on the other side of the computer. We can stop KYC if we stop participating in them. Why people do, to begin with we will never know.