LocalBitcoins Warned of Stricter User Identification Requirements
LocalBitcoins P2P trading platform announced that it would introduce new, more stringent requirements for identifying users as part of their desire to work in accordance with EU legislation.
The company intends to make “significant changes” in its work after the introduction of the new AML/KYC policies in its national jurisdiction — Finland — as the country updates the rules in accordance with EU legislation 5AMLD, which entered into force last year.
LocalBitcoins noted that “the exact nature of the changes remains uncertain and is still under development,” and also announced that further details will appear in March.
“The legal requirements are still being delineated but it is already clear that it will bring major changes into the functioning of virtual currency exchanges,” the statement summarizes.
For a long time, Localbitcoins maintained the reputation of a platform for exchanging bitcoin for fiat currency without restrictions, which usually accompany such operations on cryptocurrency exchanges.
Despite the fact that the platform is already working in full compliance with the law, changes in identification and, therefore, user privacy has traditionally been criticized.
“The most important changes concerning LocalBitcoins’ users will be related to improving the registration of new accounts and the identity verification processes, introducing wallet withdrawal and trade volume-based verification tiers,” the statement added.
In some jurisdictions, LocalBitcoins are particularly popular in the face of economic and political instability. In early February, Venezuela set new records for P2P bitcoin trading against the backdrop of new regulation. Singapore and Eastern European P2P markets also reached record trading volumes. It is unclear how the new identification requirements will affect these markets.
Author: Marko Vidrih