KYC

KYC definition: The process of verifying the identity of users to comply with regulations.

KYC (Know Your Customer) verification is the process used by financial platforms, including crypto exchanges, to verify clients' identities by collecting personal data like name, address, and ID.
Crypto exchanges implement KYC in order to prevent financial crimes, enhance security, and comply with regulations.
KYC remains controversial in the crypto space as it conflicts with the anonymous and decentralized nature of blockchain technology.

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By Michelle Legge • Head of Crypto Tax Education

Updated Jul 15, 2025

This article has been fact checked and reviewed as per our editorial policy.

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The information on this website is for general information only. It should not be taken as consulting professional advice from Koinly. Koinly is not a financial adviser. You should consider seeking independent legal, financial, taxation or other advice to check how the website information relates to you unique circumstances. Koinly is not liable for any loss caused, whether due to negligence or otherwise arising from the use of, or reliance on, the information provided directly or indirectly, by use of this website.