That's an interesting topic. I actually used to be firmly against KYC. My first account was on Poloniex, and I left right after Circle acquired them and introduced verification. It was the same story with several other exchanges after that – as soon as they enforced KYC, I stopped using them.
I was planning to do the same with Cryptomus. They also started without KYC but then introduced it after getting their Canadian license. However, one of their managers convinced me to stay.
His argument was that basically all major crypto companies are licensed and require KYC now. So today, a lack of verification is more of a 'red flag' for an exchange than a benefit.
Besides, with all the wallet de-anonymization tools available now, you can't really talk about bulletproof anonymity anyway. But the fact that Cryptomus supports a privacy coin like XMR, combined with their transaction policies, ensures a solid level of quasi-anonymity.
So, in the end, KYC isn't an obstacle to anonymity. You can be 'hidden in plain sight' if you understand how cryptocurrencies really work
I understand where you’re coming from, but I strongly disagree with the idea that KYC has become a “benefit” or that it doesn’t affect anonymity anymore. Here’s why:
1. KYC massively increases user risk.Every major exchange that collected IDs has suffered leaks - Binance, Coinsquare, BitMart and many others. Unlike a leaked password or private key, your passport, selfie and home address can’t be “rotated” or changed. Once exposed, you’re permanently vulnerable to identity theft, phishing, blackmail and credit fraud. That’s a huge liability users are forced to take on for very little in return.
2. “Everyone does it” is not a valid argument.Large platforms introduced KYC under pressure to get banking access and licenses, not to protect users. And ironically, KYC didn’t prevent the biggest disasters in crypto: FTX, Mt.Gox, Quadriga - all fully KYC’ed. It didn’t protect users from fraud, mismanagement or hacks.
3. Anonymity erosion is not an excuse to surrender it.Yes, blockchain analytics can deanonymize wallets. But combining them with centralized KYC makes it trivial to permanently tie your entire crypto history to your government ID. Without KYC, there’s at least a barrier. With KYC, you’re voluntarily handing over the master key to your privacy.
4. “Hidden in plain sight” is misleading.True privacy is about minimizing data trails, not adding more. Using XMR or good opsec helps, but if your passport is linked to your account, you’re not “hidden” at all - you’re simply trusting that the exchange, regulators and every hacker who breaches them won’t abuse that link.
In short: KYC doesn’t protect users, it exposes them. It doesn’t stop fraud or collapses, it just creates mass databases of sensitive information that inevitably get abused. Calling the absence of KYC a “red flag” is the exact opposite of reality - in crypto, it’s actually a sign that the platform still respects user freedom and security.