BitMEX, the cryptocurrency derivatives exchange, has planned to launch a user verification program to create a more trusted and secure trading environment, requiring all customers to complete ID checks within the next six months.
It has been reported that they are offering a trading competition that’s only available to verified customers but as a sweetener.
However, while BitMEX was founded in 2014 and has grown to become one of the largest derivatives exchanges in the world, the platform has not previously required user verification.
Ben Radclyffe, the Commercial Director of BitMEX, said that all of BitMEX’s customers must complete the new verification process by February 12, 2021.
“User verification has been on our list of things to do. We’ve been getting ready for this, as it’s become necessary in order to run a scalable, responsible, compliant platform moving forward. This is a building blockchain for us to grow and do business in the future.”
Likewise, with numerous jurisdictions around the world coming out with explicit regulations for the crypto industry, Radclyffe noted that having a user verification process in place will help exchanges meet new operating requirements.
User verification will also allow BitMEX to better understand its diverse user base, allowing the platform to develop tailor-made products for customers.
BitMEX will require all customers to complete ID checks before February 2021 https://t.co/XsAsm2g6Cu — Cointelegraph (@Cointelegraph) August 14, 2020
As per the report, details of the large-scale trading tournament for verified customers will come up in the upcoming weeks.
According to Radclyffe, BitMEX’s user verification program should only take customers five minutes to complete. Individuals will go through a four-step process similar to ID checks conducted by other cryptocurrency exchanges. Customers will be required to upload a photo ID and proof of address. In addition, a number of multiple-choice questions relating to funds and trading experience will be asked.
“Users who have been through an online financial services verification will be well versed in this process.”
He further said that BitMEX’s corporate customers will resume with the same verification process already in place, yet new features may be added to make the process easier moving forward. This is especially relevant, as BitMEX launched a new program for its corporate clients on June 22 to provide enhanced security and accounting features.
The report stated that compulsory verification is likely to be unpopular with some but provide others with greater confidence in the platform, as the exchange went offline for 25 minutes, leading members of the crypto community to question if foul play was happening behind the scenes.
Thus, Radclyffe explained that customer security will be greatly enhanced by identification verification, especially in the event of a dispute, hack, or incapacitation.