Understanding KYC & AML requirements on your personal information

KYC = Know Your Customer

AML =  Anti Money Laundering

Both are laws by regulators around the world, to ensure money is clean and not coming from illegal sources.

 

When you open your account at CoinBase.com or any other bitcoin reseller – you will be asked the usual customer information. Since you are transaction money, the laws require companies to “KNOW” who you are and the source of your funds.  The goal is to ensure you are not using this as a source to clean money from illegal activities.  In most cases 99% of people are never affected, most fraud happens on the transaction side not the personal information side.

You will most likely have to share your Name, address, phone, social security number, a proof of one or two IDs and scanned copy of a bill (credit card, phone or gas).  You will need this same information to open up account at most crypto exchanges as well, so let’s ensure you have these ready to submit when requested.

 

Now that you’ve provided your customer info, you will be confirmed and allowed to start purchasing small amounts of bitcoin.

 

WHY ONLY SMALL AMOUNTS?

Simple. Trust.

 

Both parties need to build trust, the only and best way to do that is via lots of small transactions. If I ask you for $100,000 payment for work I did, no refund and we’ve never met – how safe would you feel? not very.

But if we transacted $1000 at a time or less, the trust would begin and build as we continued our transaction to completion.

Each time we do that we can increase the amount since our trusting relationship has grown and proven itself.


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