How to Buy Crypto Without KYC | Your Ultimate Guide by SimpleHold

Intro

The cryptocurrency industry grows and develops, so financial regulators are seizing the firms that offer digital asset services to follow the same rules as traditional banks. Here is where the debate arises about privacy and security balance. Know-your-customer (KYC) is supposed to prevent the illegal use of cryptocurrencies. Since that, there have been two parties — pro-non-KYC and non-KYC. 

What Is KYC?

What exactly does KYC mean? That's an acronym for "know your customer." It refers to a financial institution's obligation to carry out certain identity and background checks on its clients before allowing them to use its product or platform. It is part of the measures that regulators use to resist money laundering.

Mainly, it is supposed to stop bad actors from hiding the illegal source of their money behind the legitimate financial activity.

Usually, KYC programs have three main components: 

1. a customer identification program;

2. due diligence;

3. ongoing monitoring.

Reasons Why Someone Insists on KYC

So, what are the main reasons behind imposing KYC compliance? First, it can help to manage malicious activities within the crypto space, such as crypto-virus attacks that block a user's access to a computer or network until payment is made. Let's look back to 2020 when victims transferred around $350 million in crypto to attackers, who used the anonymity of decentralized cryptocurrencies to evade detection.

As a result, The Ransomware Task Force, an international group of public and private experts, described the crypto sector as allowing this attack and proposed stricter enforcement of existing KYC laws, among other measures.

Secondly, KYC can also enhance crypto's public representation throughout the economy. Stricter compliance and more stringent identification procedures could help crypto protect its perceived association with money laundering and other criminal initiatives. Thus, encouraging wider adoption and investment.

Thirdly, as we know, the cryptocurrency market is quite volatile because of suspicious, anonymous transactions. KYC contributes to the market's stability and value growth.

Reasons Why Someone Avoids KYC

It's easier to understand why some people like the KYC idea; a logical question arises about those who don't appreciate the KYC process. It seems the main pain point is data breaches. 

The matter is that scammers look to well-known breach exchanges and even combine datasets they get from various sources to provide more robust profiles that can be sold off for scammers to use for other operations. 

What kind of data becomes vulnerable? Scammers can steal your:

• physical address

• photos including images of the account — passports/licenses

• withdrawal addresses 

• IP information 

• financials

• trading activity

• login activity

Some say that the pros of the KYC procedure don't cover the cons, as it costs arm and leg to catch a few scammers with the KYC while jeopardizing the crypto-holders' majority. Anyway, it's pretty evident that people don't like sharing their personal data and trying to escape that by using reputable DEXs.

Can I Buy Crypto Without KYC?

Crypto ATMs and decentralized exchanges (DEXs) don't ask for KYC. Using ATMs, you can buy cryptocurrency using cash or debit cards, whereas DEXs are blockchain-based P2P markets that permit large-scale crypto asset trading. DEXs do this using automated algorithms rather than acting as financial intermediaries. DEXs don't ask for your personal information and allow you to trade crypto without putting yourself at risk. Let's quickly go through some of the most prominent DEXs for your safe and sound trading maneuvers.

Best 5 Crypto Exchanges Without KYC 

1. ByBit

Bybit allows you to trade crypto without identity verification. It is a safe and transparent trading system as it's aimed to build the next-generation financial ecosystem supported by blockchain technology. It is widely considered the platform has 1.6+ million users to be the best crypto margin trading platform.

Existing crypto holders can transfer their assets to Bybit to trade on the derivatives market, which features more than 100 crypto trading pairs to trade with leverage up to 100x. The derivatives products offered include USDT perpetual, inverse perpetual, inverse future, USDC perpetual, USDC options, and leveraged tokens. All of these markets can be traded without passing the ID verification stage.

What makes Bybit top of this list is the no-fee spot trading promotion. There are zero fees on all spot pairs, which means individuals can trade crypto without fees and ID verification. The default fees for trading with leverage are 0.06% (makers) and 0.01% (takers), which is extremely competitive in the market. The spot fee is 0.1%, although non-verified users cannot buy crypto with fiat. In addition, users can only withdraw up to 2 BTC without KYC, and cashing out in fiat is prohibited. To obtain a higher withdrawal limit, users must then complete basic verification.

2. KuCoin

KuCoin platform is the biggest crypto exchange out there by volume and works in more than 200 countries, making it easy to access. However, USA users don't have a chance to use the platform. For all other crypto traders, KuCoin is known as one of the best altcoin trading platforms, with multiple choice of markets, including spot trading, margin trading, derivatives, mining pools, staking, and lending.

KuCoin allows you to simply deposit your Bitcoin in your account and trade cryptocurrencies immediately. 

It's worth mentioning that KuCoin offers a range of services from P2P trading to crypto futures, such as crypto staking, where users earn a passive income while their crypto is in their wallet. 

But be careful, as there are some restrictions for those who don't like the KYC procedure. The pain point is that unverified accounts are limited to a withdrawal limit of 1 BTC per 24-hour period and USD 400 on the P2P crypto exchange. 

3. PrimeXBT

If you're looking for an exchange to withdraw your USD, have a look at PrimeXBT. 

PrimeXBT offers futures contracts in Forex (FX), cryptocurrency, commodities, and indices that can be traded using Bitcoin as collateral. This makes the exchange something unique and provides us with more trading opportunities. On top of that, PrimeXBT has such features as crypto copy-trading and a yield farming platform to earn rewards and bonuses.

PrimeXBT offers one of the highest withdrawal limits for account holders who don’t want to go through the KYC. Each account has a withdrawal limit of up to $20,000 within a 24-hour day. Bear in mind that you can eliminate the limit by completing the PrimeXBT KYC process.

4. SimpleSwap

Another great option for non-KYC lovers is SimpleSwap. The exchange is connected with some of the biggest crypto exchanges around the world, enabling the platform to offer 600+ coins to choose from.

It’s a medium for instant trading with no complications, limits, or registrations. You can start trading assets right away. The website's interface is neat and straightforward, so there is no need to be a technical guru. SimpleSwap provides you with a 24/7 live chat feature, so any issue can be solved immediately. There's also a price alert notification option to stay always updated.

5. OKX

Maybe you haven't known, but OKX has a decentralized exchange. It's built on top of OKX's enterprise blockchain, OKC. Using it, you can swap any token across any chain without constraints on trading volume or trading pairs. You have around 10+ chains, 100+ DEX, and 100,000+ coins to your service.

OKX's X Routing algorithm looks for the best price across every DEX. It compares prices from various Liquidity Providers (LPs) with the best liquidity pools and split orders and considers prices, slippage, and network gas fees. Their KYT (Know Your Trade) Risk engine is there for you to avoid asset losses by defining unfavorable trading prices, counterfeit tokens, rug pulls, honeypots, and high burn rates.

Trading on OKX DEX promises a smooth trading experience and lower trading costs. OKC aims to offer a better, more trading-oriented DApps and DEXs infrastructure. This helps to lower the expenses associated with installing trading DApps for developers and indirectly reduces trading fees for customers.

The Bottom Line

Is it okay to have a KYC procedure? Still, there is no exact answer. It's pretty relative and massively depends on our beliefs. If you're a fan of strict regulation, trust authorities, and are afraid of being hacked while using DEXs — you're a KYC devotee, but once you don't believe CEXs, intermediaries and feel like you'll be even more compromised by providing your personal data — you're a non-KYC rebel. 

Do you have your favorite DEX? If so, which one? Please share your thoughts on the topic, and tell us do you prefer KYC or Non-KYC exchanges and wallets.