From 28 August users of crypto derivatives exchange BitMEX will have to go through a new mandatory identity verification process, the firm said in a press release on 14 August.
According to the announcement, this will be the first time that the platform has required user verification, with the program starting from 28 August. In order to accommodate unverified users, the exchange will be giving a six month grace period, lasting until 12 February 2021, in which users have to complete the new verification process.
The press release reads:
“We will be launching our User Verification Programme at 00:00 UTC on 28 August 2020, where all customers will be asked to complete ID checks within the next 6 months. These new controls will enable us to create a more trusted and secure trading environment for all BitMEX users.”
Founded in 2014, BitMEX has already grown to become one of the largest derivatives exchanges. Previously, users outside of restricted jurisdictions were able to register on the platform by only choosing an email address, a password, and a country of residence. The new mandatory verification process will be a completely different matter though, seeing as it will require information such as proof of location, funds, trading experience, and more.
The exchange said that the new measures are being taken in order remove the entry barriers for some of its target users, while at the same time improve the security of the platform. Having a user verification process in place will also help the exchange “get ahead of evolving regulations” in the cryptocurrency industry.
The exchange said:
“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. 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.”
The exchange has also claimed that the new verification process will be fairly similar to the ID checks conducted by other exchanges, and that it should take no more than five minutes to complete. It will ask users to upload an ID photo and proof of address, and then complete a number of multiple choice questions related to funds and trading experience. BitMEX’s corporate clients will continue to go through the already established verification process, though that might change in the future.