Changpeng Zhao reported that most people feel more comfortable using a licensed exchange

​After KYC was introduced, 3% of customers left Binance

18.11.2021 - 11:40

603

1 min

What’s new? Speaking to Bloomberg News, Binance exchange CEO Changpeng Zhao noted that the platform has made the Know Your Customer (KYC) process mandatory for users in an attempt to meet regulatory requirements. He said that Binance has lost about 3 % of customers since the introduction of mandatory KYC.

Zhao's interview with Bloomberg News

“We feel that being compliant will allow more users to use us,” Zhao said, adding that most people feel more comfortable using a licensed exchange.

What events preceded it? Binance positioned itself as a decentralized entity without a physical head office. However, Zhao stated that the crypto exchange is ready to work with local regulators and set up a headquarters. He added that regulators were initially skeptical of Binance, their opinion has changed as the interaction continues:

“We want to be licensed everywhere. From now on, we are going to be a financial institution.”

What is KYC? It is a common practice used by crypto exchanges and traditional financial institutions. It allows companies to verify a user's identity by requesting some form of real identification. Binance made KYC mandatory for all its existing and new customers on August 20 so that they can access products and services.

Subscribe to Getblock Magazine and stay up to date with the latest news from the world of cryptocurrencies and the digital economy