What you should know about KYC (Know Your Customer).
These are the breakdown to help you understand:
What is KYC?
KYC is a process where users verify their identity before they can use a financial service (like buying/selling crypto). It usually involves submitting an ID, utility bill, or taking a selfie.
Cryptocurrencies That Require KYC
KYC is usually enforced by centralized platforms (like exchanges and wallets) rather than the cryptocurrencies themselves. These platforms must follow government regulations. Examples include:
Binance, Coinbase, KuCoin, Kraken, etc.
These platforms may require KYC to:
Deposit/withdraw large amounts
Access all trading features
Comply with anti-money laundering (AML) laws
Cryptocurrencies/Platforms That Don’t Require KYC
Some crypto projects value privacy and decentralization, so they don’t enforce KYC. These are typically:
Decentralized Exchanges (DEXs) like Uniswap, PancakeSwap
Privacy Coins like Monero (XMR), Zcash (ZEC), Dash
DeFi protocols (lending, yield farming, staking)
Some crypto wallets (e.g., MetaMask, Trust Wallet)
Important things you should Note:
While you can use crypto without KYC on some platforms, KYC is required if you’re using bank transfers, fiat gateways, or large exchanges.
Governments around the world are increasing regulation, so even some DeFi platforms may add KYC in the future.
If you’re thinking of launching or using a crypto project, let me know what you’re trying to do and
I can help guide you on the KYC rules that may apply.
We need to know that the Original Vision of Crypto
Cryptocurrency was originally created (especially Bitcoin) to:
Free people from centralized control, like banks and governments.
Offer privacy, security, and autonomy.
Create a peer-to-peer financial system without middlemen.
The core philosophy was to challenge the traditional system — especially after the 2008 financial crisis.
Why Then KYC? Why the “Partnership” with Governments?
As crypto grew popular, governments realized it could:
Be used for money laundering, terrorist funding, fraud, and tax evasion.
Potentially undermine central banks, financial policies, and even national currencies.
So they stepped in with regulations — and one of the most powerful tools they used is KYC (Know Your Customer).
Why Some Crypto Platforms Use KYC
These are the key difference:
Decentralized crypto (like Bitcoin, Ethereum) itself does not require KYC.
But centralized services that allow people to convert crypto to fiat (dollars, naira, etc.), like Binance, Coinbase, etc., are under government regulation.
To legally operate in most countries, they must:
Comply with anti-money laundering (AML) laws.
Protect against fraud and financial crimes.
Report to tax authorities.
So if a company wants to stay operational and global, they’re forced to obey those laws.
But Here’s the Twist:
The core crypto networks like:
Bitcoin
Ethereum
Monero
Solana
And Decentralized Exchanges (DEXs) like Uniswap, PancakeSwap
… don’t require KYC at all. You can use them anonymously.
But once you need to:
Buy crypto with your bank card
Withdraw to your bank account
Trade on centralized exchanges
…you enter the “bridge” between crypto and the traditional system, and that’s where KYC comes in.
So What’s the Future?
There’s a battle happening:
Governments want more control over crypto.
Crypto communities want to keep it free and decentralized.
Some countries like China banned it, others like El Salvador adopted it.
Decentralized Identity (DID) and Zero-Knowledge Proofs (zk-SNARKs) are new technologies that may help people prove things (like age, citizenship) without revealing identity.
My Final Thought:
Crypto is not a single entity — it’s an ecosystem.
Some parts are decentralized and rebellious, others are centralized and obedient — and both are growing at the same time.
If you want to stay purely decentralized and anonymous, you still can — but once you step into traditional money, the system demands your identity.
To stay purely decentralized and anonymous in the crypto space is very possible — but it requires understanding the tools, networks, and behaviors that avoid centralized systems.
These are a step-by-step guide to doing it right:
- Use Decentralized Wallets (Non-Custodial)
These wallets give you full control of your private keys. That means:
No one can freeze or access your funds.
You don’t need to provide any identity or KYC.
Examples:
MetaMask (for Ethereum and other EVM chains)
Trust Wallet
Exodus
Keplr (for Cosmos ecosystem)
Phantom (for Solana)
Wasabi or Samourai Wallet (for Bitcoin + privacy features)
- Use Decentralized Exchanges (DEXs)
Avoid centralized exchanges like Binance or Coinbase. DEXs let you trade tokens directly from your wallet, no KYC required. Popular DEXs:
Uniswap (Ethereum)
PancakeSwap (BNB Chain)
SushiSwap
dYdX (for decentralized derivatives)
1inch (DEX aggregator)
ThorChain (cross-chain swaps without KYC)
- Use Privacy Coins (If You Need to Stay Hidden)
These cryptocurrencies are built to hide your transactions and balances. For Examples:
Monero (XMR) – ultimate privacy
Zcash (ZEC) – optional privacy
Dash – with PrivateSend feature
Firo
Note: Some governments frown on privacy coins, and they are delisted from many exchanges — but they’re fully legal in many places.
- Use Anonymous Browsers and VPNs
To avoid surveillance, use:
Brave browser (private by default)
Tor Browser (for deep anonymity)
VPN (ProtonVPN, Mullvad, NordVPN, etc.)
Orbot + Orfox (for mobile Tor access)
This helps you hide your IP address while using DApps or blockchain explorers.
- Buy Crypto Anonymously (Avoid Fiat On-Ramps)
This is the trickiest part. Most centralized fiat on-ramps (e.g., buying with card or bank) require KYC.
Alternatives:
P2P Trading: Platforms like:
LocalMonero
Bisq (truly decentralized Bitcoin P2P exchange)
HodlHodl
Use cash deals with trusted individuals.
Mine coins directly (Bitcoin, Monero, etc.)
Accept crypto for services or products you sell.
- Stay Off Centralized Platforms
Avoid:
Storing funds on Binance, Coinbase, KuCoin, etc.
Using wallets that require email/phone sign-up
Connecting wallets to unknown websites (can be unsafe)
Bonus Tools for Deep Privacy
Tails OS: An operating system that runs from a USB and leaves no trace.
Whonix: Privacy-focused Linux distro that routes everything through Tor.
Ledger or Trezor: Hardware wallets for secure offline storage.
Note These:
To truly stay decentralized and anonymous, you must:
Own your keys (not your keys, not your crypto)
Avoid KYC points (where they ask for ID, face, passport, etc.)
Use privacy-first tools
Always stay informed, as the crypto space is changing fast.
You don’t have to be a hacker to stay anonymous, just smart and intentional.
