Poloniex, one of the longest-running cryptocurrency-only exchanges, recently announced it upgraded its customer identification and verification systems. As a result, it will now require users to verify their ID in order to continue trading.
Through a press release, the U.S.-based exchange announced the move that brings its processes in line with the wider industry, following Know Your Customer (KYC) legislation. KYC processes vary, but they usually involve making customers prove who they are, by submitting their ID and a photo.
“We have recently completed a major upgrade to our customer identification and verification systems. As a result, we will soon require legacy accounts to become verified through the latest version of our verification portal.”
According to the press release, its deadline for identification verification will be released in the first quarter of 2018. Users who fail to verify their IDs will no longer be able to trade, lend, open orders, or deposit.
Margin position will be given an eight-week grace period in which traders will be able to diminish or close them. After eight weeks positions will be closed, and all users will be able to do is withdraw their funds from the exchange.
Those who’ve recently set up an account with Poloniex shouldn’t need to worry, as they had to undergo the verification process as part of their initial setup. After the verification process, users will be able to use the exchange at will. The verification allows for a $25,000 daily withdrawal limit, up from $2,000.
The exchange noted that “as a registered money services business, Poloniex is committed to compliance with all applicable law requiring identification and verification of its customers.” The move comes at a time in which various cryptocurrency exchanges halt new user registrations due to overwhelming demand.
Incorporated in Delaware, Poloniex is currently the 6th biggest cryptocurrency exchange, with a daily trading volume of over $860 million. The company didn’t reveal how many legacy accounts are affected by the change.
Community reactions to the Poloniex announcement
Part of the cryptocurrency community seemingly applauded Poloniex’s move. On the Bitcointalk forum, one user wrote “at least they give ample warning long before the new measures go into effect.”
On Reddit, another user noted that it is better for the exchange to comply, than for it to shut down. To him, paying taxes and complying is better than going down with people’s money in its wallets.
Others restated that they’ve been waiting for verification for weeks, implying the exchange won’t be able to handle the move. Poloniex has in the past been under fire for its poor customer support service, so much so it created damaging rumors