It can be quite challenging to predict in which direction the volatile cryptocurrency market can go. Often, you might want to jump in on a profitable opportunity or hedge against the sudden volatility of a certain coin. For this reason, you will need a reliable platform to exchange your crypto.
However, in the past few years, it has become more and more difficult to find an exchange that offers a streamlined way of converting coins. The main culprit is the increasingly invasive AML (anti-money laundering) policies enforced by government agencies.
In this article, we talk briefly about KYC, explain what it is and its reason for existing. We also lay out some of the best options that are offered in today’s market for exchanging cryptocurrencies anonymously in 2021.
What is KYC and why is it everywhere?
KYC stands for “know your customer”. It is a process that refers to the identification procedure required by crypto exchanges to remain compliant with crypto regulations around the world.
Government agencies require exchanges to request a full KYC procedure for two main reasons:
- Reduce the risks of money laundering using cryptocurrencies.
- Eliminate the chance of illegal use of crypto on black markets and the darknet.
During KYC, you will usually have to provide your name, address, and phone number. Furthermore, exchanges will often require a copy of your ID, as well as some proof of your residential address, such as a bank statement or a power bill.
It can become quite tedious to provide all of these details, then wait for a confirmation before you can proceed with your cryptocurrency exchanges.
With that said, time isn’t the only concern when you comply with a KYC procedure. There are multiple reasons why you wouldn’t want to expose your personal information to a cryptocurrency exchange.
- You do not trust the exchange. You might not trust the owner of the exchange or their security measures enough to provide them with your personal details.
- You want your crypto investments to remain private. Even if you are doing everything legally, you might want to keep your crypto investment secrets from government agencies and prying eyes.
- You don’t want to risk exposing your holdings. If an exchange is hacked and your credentials are compromised, it could make you a target for criminals. For instance, a recent security breach in the Ledger database exposed hundreds of thousands of investors’ names and addresses.
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How to exchange crypto anonymously in 2021
Luckily, there are still some foolproof methods of exchanging crypto anonymously even in 2021. The options we provide below should be a good alternative for exchanging crypto without going through a tedious KYC process.
Godex is an anonymous crypto exchange, where investors can swap over 200 different cryptocurrencies. It offers an easy and streamlined way of exchanging crypto, without going through ID verification.
Above all, Godex is very serious about providing the highest level of privacy to its users. For instance, the exchange doesn’t require any kind of registration. As such, you do not provide any kind of personal information to Godex.
The user simply chooses a trading pair and deposits the coins they want to exchange on a newly generated address by the exchange. A few minutes later, they receive their swapped coins directly in their crypto wallet.
As you might have noticed, there was not a single exchange of sensitive data in that simple process. And finally, yet another benefit of Godex is that they do not fix any exchange limits for anonymous crypto exchanges, which is a rare feat in this market.
Binance is the most popular cryptocurrency exchange in the world, with millions of different users interacting with the platform on a daily basis.
One of the biggest advantages of Binance is that it doesn’t have an overly invasive KYC procedure for its basic functions.
Consequently, users can register an account only with an email. This will grant them access to exchange crypto-to-crypto pairs and to deposit and withdraw crypto with a daily limit of $5,000.
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Uniswap is a decentralized crypto exchange, powered by smart contracts. In this case, the swap is processed strictly peer-to-peer. Users can interact with the exchange directly with their crypto wallet.
As such, crypto swaps can remain pseudonymous, with only the transaction data remaining present on the blockchain.
Cryptocurrency regulations and AML policies have resulted in an increasing number of exchanges requesting your credentials before they allow you to swap cryptocurrencies.
However, if you wish for your crypto investments and exchanges to remain private, there are still a lot of options out there.