Cryptocurrency derivatives exchange BitMEX has announced that it will be launching a user verification program on August 28th. According to an official statement from the company, all customers will be asked to complete ID checks within six months of the program’s launch.
On 28 August 2020 at 00:00 UTC, we will be launching our User Verification Programme. For details, please see our blog: https://t.co/9L2UNZk0t9
— BitMEX (@BitMEX) August 14, 2020
The company also says that it will be launching a significant ‘Trading Tournament’ for users who complete the verification process. Verified users can compete for ‘sizable prizes’.
This is the first time since BitMEX’s 2014 foundation that the platform has required users to verify their identifies. However, Ben Radclyffe, Commercial Director of BitMEX, told Cointelegraph that “user verification has been on our list of things to do.”
ID Verification Is “necessary in order to run a scalable, responsible, compliant platform”
“We’ve been getting ready for this, as it’s become necessary in order to run a scalable, responsible, compliant platform moving forward,” he said. “This is a building blockchain for us to grow and do business in the future.”
The new process should only take a few minutes to complete and will be very similar to the ID checks that are required by many other cryptocurrency exchanges. Customers will be asked to upload a photo ID and proof of address, and they will be asked a number of multiple-choice questions regarding funds and investment experience.
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BItMEX’s corporate customers will face the same ID verification process that is already in place. However, new features may be added in order to make the process simpler. These measures will support the BitMEX’s new program for corporate clients that was announced in June 2020.
Additionally, Radclyffe added that the introduction of user identity verification will help BitMEX to meet changing operational requirements as regulations for the cryptocurrency industry grow more prominent around the globe.
User verification will also reportedly help BitMEX to better understand its user base, thereby helping the exchange to make more customized products for its customers.
Twitter Seems to Be Unhappy With BitMEX’s Decision to Add Identity Verification
While identity verification certainly seems to be becoming the ‘norm’ on cryptocurrency platforms across the globe, BitMEX’s announcement has been met with some friction on Twitter.
All the same, the introduction of identity verification onto BitMEX’s platform does seem to signal that the exchange is taking strides toward being a more compliant, regulation-friendly entity.
“Today, user identity verification is increasingly expected in order to meet evolving international regulatory standards, and is an important part of building trust in the cryptocurrency ecosystem,” an official statement from the company said.
“Practical customer security is greatly enhanced by identity verification, allowing BitMEX support personnel to reliably verify the actual owner of an account in the event of a dispute, hack, or incapacitation.”