Binance is a top cryptocurrency trading platform. The exchange resolved to mandatory Know-Your-Customer (KYC) verification following an outbreak of scams and fraud among traders.
Initially, you could sign up and proceed with trading on Binance without KYC. However, in 20th August 2021, Binance introduced mandatory KYC before proceeding with any activities.
What is KYC?
KYC is a Know Your Customer (KYC) functionality that most financial systems use. Knowing your customer uses identity verification such as, National ID, Proof of document living in a country, phone number and email.
Reasons for Binance Mandatory KYC
Prevent fraud.
To be licensed everywhere even by local regulators.
Increase partnerships.
Did Binance Lose 90% Of Its Users After Introducing Mandatory KYC?
According to CoinDesk, Binance lost 3% of its users following introduction of KYC in 2021. This is normal in any financial institution because some users have multiple accounts. Introducing KYC renders these accounts inactive.
However, yesterday, a rumour by ICO Drops began spreading with the news that Binance lost close to 90% of its users. Honestly speaking, even you and I know this is a rumour. The most could only be 5%.
The CEO even took to addressing the matter by saying it is false information. Changpeng Zhao took to Twitter saying ,
"It's a complete mis-quote. Look at the numbers... But the fact is, this type of headlines sell more clicks... Sad, but true."
The Information is false
Even though top crypto news sites have published articles regarding the lose of Binance users following KYC, it is clear that the information is false. CEO Zhao is a very open person who does not keep crucial information from its users.
Binance has grown over the past year and is even implementing local banks to its platform, something that would be impossible without KYC. Do not believe everything you read on the internet.
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