Decentralised applications, including decentralised exchanges (DEXs), are not required to run KYC on their users under the majority of countries' existing legislations since these procedures are ruled out financial middlemans or counterparties.

Crypto derivatives exchange BitMEX made a comparable transfer to adhere to kyc requirements for cryptocurrency a year earlier, needing information on trading experience as well as identification, partially to get ahead of evolving policy." Customers had formerly just needed to provide an e-mail address.

As the cryptocurrency market expands and matures, national and international monetary regulators are putting more stress on firms that provide electronic asset solutions to adhere to the same guidelines as conventional banks.

In late 2020, FinCEN recommended that cryptocurrency and digital possession market individuals submit, maintain, and verify consumers' identities, classifying certain cryptocurrencies as financial tools; hence, subjecting them to KYC requirements. KYC demands do not put on decentralized exchanges (DEXs), meaning those that organize trades through clever agreements rather than a central trading workdesk are not required to divulge their identifications.

The changes requiring consumers to reveal their identifications began in 2018 soon prior to The Wall Street Journal alleged the exchange had been commonly made use of to launder cash - which the business refuted. Crypto exchange Binance introduced in August 2021 that new clients would have to supply a government-issued ID and pass face confirmation in order to make down payments and professions.