The UK cryptocurrency ecosystem is rapidly growing as more investors are buying and selling cryptocurrencies. Crypto trading platforms are emerging to meet increasing demand in the UK financial market. As the cryptocurrency industry is not regulated by any government authority or central bank, there are always financial crime risks in crypto exchanges. In this scenario, KYC checks and AML checks have become the true backbone of UK crypto exchanges, which assist in ensuring legitimate crypto buyers and sellers.
An identity verification system is significant to build a robust security system that does not allow unauthorised access to sensitive information in crypto exchanges’ business. KYC checks and AML checks play a huge role in it to evaluate business risk and identify fraudulent identities.
What Are KYC Checks and AML Checks?
KYC check is a process to verify and authenticate a user’s identity before allowing them to access financial services. In the crypto industry, KYC checks typically include:
Collecting official identification documents such as a passport, a driving license, and a government-issued ID.
Verifying the identity with Government records through various data resources.
Confirming the legitimacy by ensuring a match or not a match.
These KYC checks ensure that the crypto account is real or not. It gives the surety of a genuine crypto buyer or seller and builds trust for secure crypto transactions.
AML checks ensure whether a crypto customer is associated with money laundering, terrorist financing, identity manipulation, and illicit crypto transactions. In the crypto industry, AML checks assist in analysing risk levels, identifying suspicious activities, and reporting high-risk actions.
Why UK Crypto Exchanges Can’t Ignore KYC Checks and AML Checks?
Both KYC and AML checks assist in secure crypto trading and smooth business operations in the digital world, where fraudsters keep an eye on the crypto industry. There are several reasons why KYC check and AML checks can’t be ignored in the UK crypto industry, as they are:
Prevent Fraud:
Crypto remains a top target for fraudsters and financial criminals who try to
- Fake accounts creation
- Bot-driven trading
- Account takeovers
- Phishing attacks
- Document forgery
With robust KYC checks, fraudsters can be identified during account creation and prevented from creating fake accounts that use forged ID documents. AI and machine learning algorithm-based identity verification also identifies fraudulent behaviour early, which reduces the risk of account takeovers. AML check includes transaction monitoring, which assists in real-time identity verification and identifies suspicious transactions related to money laundering. It helps to take immediate action against them and prevent financial fraud.
Prevent Illicit Crypto Transactions:
The decentralised nature of cryptocurrency attracts financial criminals, and they try to do:
- Launder money
- Transfer illicit funds
- Conduct cross-border fraud
- Support illegal marketplaces
AML checks keep the crypto trading platform ahead of suspicious activities through transaction monitoring, AML screening, and transaction pattern analysis. It prevents illicit crypto transactions and safeguards crypto exchanges.
Build Trust Among Traders and Investors:
Traders and investors prefer the crypto trading platforms that prioritise security and safety. KYC check and AML check ensure that legitimate crypto buyers and sellers are identified, which gives transparency, confidence and builds trust for secure crypto exchanges. Trust is paramount for crypto platforms that keep ahead of the curve in the UK’s competitive market.
Maintain Fraudproof Business Reputation:
For crypto trading platforms in the UK, business reputation is significant to attract new crypto buyers and sellers. KYC check and AML check help in maintaining a fraud-free crypto business reputation in the competitive market by ensuring genuine crypto buyers and sellers, preventing fraudsters and money launderers.
Enhance Security:
KYC check, and AML check build a strong security system that reduces account breaches, fraud, and unauthorised access, and create a secure platform for crypto trading.
The above are the reasons why KYC checks and AML checks can’t be ignored in the cryptocurrency exchange business.
How KYC UK Helps Crypto Trading Platforms:
KYC UK is a trusted and reliable KYC solutions provider in the UK, providing identity verification solutions for financial businesses such as banks, financial institutions, fintech, cryptocurrency, digital payments, insurance, lending, BNPL, payment processors, forex, and cross-border payments. KYC UK offers an advanced KYC API to authenticate the identity of the customer during the onboarding process and assist UK financial businesses in a quick onboarding process. Their API suits the cryptocurrency industry and supports multiple languages. They provide complete identity verification solutions, including document verification, KYC verification, AML verification, business verification, PEP and sanction list verification.
- KYC UK provides a customised identity verification solution according to the business need.
- Conduct KYC check and AML check for thorough background verification to ensure the legitimacy of crypto buyers and sellers.
- Assist in the quick onboarding process and provide a frictionless user experience on crypto trading platforms.
- Help in evaluating business risk based on involvement in fraudulent activities.
- Provide video KYC and transactions monitoring for real-time identity verification, which assists in risk assessment and takes action immediately against money launderers.
- Offer 24*7 Customer support to resolve technical issues.
- Their API scales the business growth as the client base increases.
- Provides a plug-and-play type of API that is easy to integrate and delivers accurate results within seconds.
- With advanced technology, their API supports liveness detection, face recognition and OCR scanning.
KYC Checks and AML Checks Are the Fraud Prevention Strategy For Crypto Exchanges:
KYC checks and AML checks form the foundation of trust, safety, and long-term growth for secure cryptocurrency markets in the world. It works as a fraud prevention strategy that assists in ensuring legal crypto buyers & sellers, prevents money laundering, secures crypto exchanges and evaluates business risk. Therefore, choose a trusted and reliable KYC services provider that assists in conducting effective KYC checks and AML checks to know about genuine crypto customers. Crypto trading platforms also have implemented cutting-edge identity verification systems that assist in identifying genuine crypto buyers and combat money laundering. Investing in advanced technology ensures business growth for a long time and maintains a fraud-free crypto exchange’s business reputation in the competitive market. In the digital business era, nobody wants to take the financial risk; therefore, implement an advanced KYC API for quick authentication and secure crypto business operations.
Every crypto trading platform in the UK must invest in digital identity verification solutions to stay ahead of financial risks and combat money laundering in the crypto industry.