Changpeng Zhao, the CEO of Binance, shed light on the compliance roadmap of the exchange and the users’ reaction to KYC. After years of avoiding KYC and playing with regulators, Binance made Know Your Customer (KYC) mandatory. In an interview with Bloomberg News, Changpeng Zhao mentioned: ‘’for global users, for every feature’’. Saying this, he wants to position Binance as a regulatory-compliant business. CZ disclosed that around 3% of the users left after making KYC obligatory.
Know Your Customer is a regular process used by traditional financial institutions and now also by many crypto exchanges. KYC allows the Crypto exchanges and traditional financial institutions to verify the authenticity of the users. This is done by requesting some identification. Not all exchanges use it the same way. Binance users have to complete the KYC process to be able to use the features of Binance. This applies to new and existing users. It was made an obligation for existing users on August 20.
The CEO noted: “We feel that being compliant will allow more users to use us,” adding that most people do feel more comfortable using a licensed exchange. In July, CZ also announced that Binance was able to work with local regulators. He said: “We want to be licensed everywhere. From now on, we’re going to be a financial institution.”
