But have you ever wondered why exactly they do this? Is it just about obeying rules, or is there something more to it?
Obviously because we have to comply with the rules, because the exchanges are now heavily regulated so these rules have become strict so KYC checks are mandatory.
But do they handle this process themselves, or are they hiring other companies to check your details? And how safe is your information once you hand it over? Some platforms also set limits on your account if you haven’t completed KYC.
The exchange will not give a statement whether they hire a third party or manage the customer data themselves but what is clear is that they provide that user data is safe, although it will not be completely because vulnerabilities can come from any gap.
If you’re curious about these things, it’s fair to ask of course: Why does the exchange really need your data, what do they do with it, and who actually gets to see it? These are important questions to ask for anyone using a crypto exchange today.
Above, because it requires users.
They store it in a database and only the security team can see it.