In January 2020, the fifth EU directive on anti-money laundering (AMLD5) came into effect. According to its requirements, any financial service wishing to continue operating legally must implement KYC and AML checks.
The first involves collecting information about each user so that this information can be provided to law enforcement agencies if necessary or in the case of suspicious operations. The second (AML) includes checking each transaction for various fraudulent activities, including money laundering and financing terrorism.
Some cryptocurrency exchanges (for example, EXMO) followed the guidelines and completely closed access to most operations for unverified users. Others implemented checks only partially, for participants dealing with large sums (for instance, on Binance you can trade without verification if you do not withdraw 2 bitcoins per day) or who want to work with fiat funds. Some platforms completely refused to implement checks in order not to lose their audience.
The last option is interesting for those who wish to maintain maximum anonymity, which is the main advantage of cryptocurrencies.
Examples of cryptocurrency exchanges without verification:
- YoBit
- Bybit
- Livecoin