Do crypto exchanges need AML & KYC?

Managing the maze of global regulations like AML (Anti-Money Laundering) and KYC (Know Your Customer) can be tricky for crypto exchanges. As a matter of fact, these are mandatory for regulated entities under Anti-Money Laundering/Counter Financing Terrorism (AML/CFT) rules all around the world.

Why do cryptocurrency exchanges need KYC?

Cryptocurrency exchanges also require KYC to comply with AML regulations. By verifying their customers' identities, exchanges can help prevent criminal activity like money laundering and the financing of terrorism. Money laundering refers to the concealment of the origins of illegally obtained money.

What is the difference between AML compliance and KYC compliance?

AML compliance involves implementing policies and procedures to prevent money laundering, while KYC compliance involves establishing protocols for customer identification and risk assessment. Global regulations and requirements ensures compliance with anti-money laundering (AML) and know your customer (KYC) standards.