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The Value of Crypto KYC Framework

Adherence to the anti-money laundering and counter-terrorist financing regulations is no more "privileged" only to the banking and payments sector. Cryptocurrencies and blockchain revolution is not a matter of future disputes; it is the reality we all have to cope with at the earliest possible juncture. Falling out of KYC compliance has a far-reaching perverse effect both on the world economy and on the end crypto-asset users.


The Taste of a Crypto Exchange
Both cryptocurrency exchanges and crypto exchanges are places where you can turn one kind of digital asset into another. Cryptocurrency exchanges do this through ading pairs. A trading pair is a market between two assets like Ethereum and Bitcoin allowing you to trade one for the other. Cryptocurrency exchanges are powerful tools that enable savvy crypto investors to gain access to liquid markets and a large number of digital assets and are a necessary component of a rapidly growing cryptocurrency ecosystem.
Crypto exchanges match buyers with sellers. As with a traditional bank account, if you desire to buy and sell on a crypto exchange, you first need to be registered. Once you complete the KYC process and go through the customer identification process, your account is activated and you are able to transfer funds (fiat or digital currency) onto the platform, which you can then use to make purchases. That is why identity verification and KYC processes have become the focus of attention for both cryptocurrency exchanges and users of these platforms.

Types of Crypto Exchanges
Currently, the market offers the following digital asset exchanges:
  • Centralized – high level of liquidity and ease of use, strong requirements towards CIP, CDD and crypto KYT.
  • Decentralized – all transactions take place on the blockchain, all coins are held by their owners, lack of AML/CT compliance.
  • Broker – a legal centralized exchange that is fully compliant with its local regulations.
  • Instant – an application for exchanging tokens quickly.
  • Hybrid – a mix, combining the security of decentralized networks with the user-friendliness of centralized exchanges.

Saving Crypto Trading
More than half of all crypto exchanges of various types have weak or no identity verification methods. This makes them vulnerable to attacks by potential offenders, at the same time that endangers users of the platform. Major risks with crypto assets arise when deposit, withdrawal or purchase of crypto take place with fiat currency.

The first and foremost for the crypto exchange platforms is to ensure the effective implementation of Anti-Money Laundering risk assessment tools and controls along with relevant KYC risk scoring methods. The user’s onboarding has to be well established and tuned, specifically, online verification tools as they are playing a key role in the crypto exchange internal control environment. The due diligence of customers has to be on the high level comprising effective online verification tools, advanced KYC controls and KYT surveillance.

The evolution and structuring of the crypto area are plain to see. The rise of different platforms that allow crypto trading drastically did affect the world economy we live in. Along with revolutionized crypto trading methods, KYC/KYT controls must be kept on the advanced level to ensure end users' security and AML compliance.


Major risks with crypto assets arise when deposit, withdrawal or purchase of crypto take place with fiat currency. The due diligence of customers has to be on a high level comprising the effective online verification tools, advanced KYC controls and KYT surveillance.


ZeroTolerance is ready to provide you the full package of crypto KYC, KYT, KYB controls. Our methods and tools encompass the major components of the advanced crypto control framework, namely, crypto overall control environment, risk assessment and monitoring along with effective end-users’ online verification.

Should you require further information or our assistance with tuning and implementation of identity verification solutions, crypto transaction and KYC monitoring tools within your company, feel free to contact our experts at info@zrtolerance.com