What are the best trading platforms without KYC?
Best “No-KYC” Crypto exchanges and trading platforms
You are a risky person for reading this. KYC is tedious, there’s ways to avoid it, and you even might succeed in doing so. Let’s dive in and see what platform you can use to avoid KYC.
Last warning on why you want to trade with KYC
Reasoning behind avoidance is understandable — not every CEX will allow you to trade crypto across the globe, there are always AML limitations and other reasons. As one of industry experts we must warn you against avoiding KYC, because it allows you to save money in the long term.
- KYC helps to avoid losing your funds. After this procedure, CEX’es are obligated to protect your customer rights.
- KYC provides legal basis to work with CEX. KYC increases chances to involve law enforcement against CEX if they misbehave, or to protect your rights in the event of theft or scam.
- KYC increases chances of fund recovery. In case your funds are frozen, KYC might help to return your money by providing a legal basis for lawsuit or recovery procedure.
- If you plan to follow bear market strategy — DEX isn’t the best choice. Technically, you can only buy crypto through DEX or use it as a go-to for crypto arbitrage. Few exceptions, however, allow you to short crypto through DEX platforms, but only at “as-is” terms with zero protection.
KYC is here to stay. This permanent presence is bolstered by a 2019 joint statement from the SEC, FinCEN, and CFTC that classified crypto exchanges as money service businesses (MSBs) — making them subject to Know Your Customer (KYC) and Anti-Money Laundering (AML) rules under the Bank Secrecy Act of 1970.
- The purpose of KYC is to reduce identity theft and fraud by having businesses collect and verify key data about customers to truly understand who they are.
- Financial institutions (FIs) often have customers go through KYC measures when they open new accounts, apply for loans, make investments, and take other important actions.
- These measures often include requests for identity data — such as driver’s licenses, SSNs, and other financial statements — verification, and the storage of this data to ensure compliance in the event of an audit.
Centralized Exchangers are KYC-only
Crypto trading platforms often provide non-KYC withdrawal limits, which might exist only on paper. For example, it is almost impossible to use Binance without KYC, because you are going to be redirected to KYC from any page of the exchange. It is because cryptocurrency exchanges are now subject to the same rules as their traditional financial counterparts.
If you look for CEX without KYC — you are looking for how to lose your money in the long term. There’s a separate section of exchange platforms, called DEX — decentralized exchanges. They do not require KYC and allow users to perform P2P transactions between each other. They have their own set of different problems, such as having your funds unprotected by intermediaries.
CEX’es can be split into 3 groups by their KYC policy
- Opted out. Such exchangers opt out of US KYC regulations by suspending access for American users. Using them from the USA is risky and requires a good VPN, which undermines CEX policy and will likely result in ban. Those who opted out are still using their own strict methods of validation, equal to KYC.
- Soft KYC. You only need to provide basic data, such as ID number or your name, and be allowed to trade right away. Privileges are only revoked if the KYC checks reveal something worrisome.
- Hard KYC. No ID check and validation — no crypto.
DEX way of CEX. One of the ways to bypass use of KYC is authorisation through wallet apps. For example, it is still possible to swap crypto by using the OKX DEX swapping platform with the wallet app of your choice. Some CEX’es have pushed back against regulations, arguing that collecting this data undermines the anonymous nature of crypto. For example, it is still possible to use OKX without KYC and have a decent trading experience, while Binance has a strict KYC policy for most of the users.
Here is the Top Centralized Exchanges (CEX) with loyal KYC policies
Soft KYC. You need to provide only basic data, such as phone number or location of residence
- KuCoin. 1 BTC every 24 hours for unverified accounts.
- OKX. 10 BTC for non-verified users.
- Huobi Global. Allows you to withdraw up to 0.06 BTC per day without verification.
- Kraken. It has a limit of $5000 per user with Starter verification level, which requires phone number and location data fields filled.
Hard KYC. To withdraw is to pass KYC in one form, or another.
- Binance. Technically allows you to withdraw 0.06 BTC, but can request to pass KYC repeatedly while trying to. Binance also runs separate CEX — Binance.USA — for the American residents.
- Coinbase. Same as with Binance — you can sign up, but to access trading tools you need to pass KYC.
- FTX. Allows to withdraw up to $2000 per user with Level 1 KYC. To pass it, you need to provide DOB, Full name, location of residence and complete phone number verification. After doing so you are unable to deposit fiat funds, to do this — you need to pass full KYC.
- Gate.io. Standard KYC story — two levels, useful only when KYC is completed in full.
You can partially bypass KYC by depositing only crypto. For example, if CEX requires you to pass KYC in order to deposit fiat money, you can instead use the Tronlink app to deposit USDT there, and then send them to CEX of your choice. However, doing so requires access to third-party swapping services, which usually work as-is.
Decentralized Exchangers don’t use KYC
Decentralized exchanges are not currently required to abide by KYC or AML regulations. That’s because DEX users complete transactions directly with one another using smart contacts, as opposed to a central trading desk like you might find in a cryptocurrency exchange.
Without KYC and AML regulations DEXs present an opportunity for financial crime. Basically, because DEX uses browser wallet extensions the same way CEX is using trading accounts, users don’t need to verify their identity. However, this makes it much easier for malicious users to slip under the radar compared to traditional financial institutions. This ease of use is what keeps DEX platforms from becoming a globally mainstream solution for the crypto industry — because creating and maintaining one might draw unwanted attention from regulators to the development team.
DEX’es won’t allow crypto shorting, because it requires brokerage around the platform. Because DEX’es only allow direct P2P exchange of the crypto, they are unsuitable for any shorting operations , and may not work with advanced trading tools such as options or futures. Mainly, DEX are used for crypto arbitrage, where you only need a price difference between different platforms.
Top 5 DEX platforms without KYC
dydx.exchange. One of the few DEX platforms that allows you to trade with short positions. As of 2022 it has $955M in daily volume and is mainly used to trade ETH perpetual swaps. The only thing you need is a WalletConnect compatible browser extension — MetaMask, Trust Wallet, TokenPocket etc.
Kine.io. Technically, this is Web 3.0 take on DEX trading desk with an orderbook, your typical limit and market orders from Kine. It is not a true DEX, but still works with WalletConnect compatible wallets, like MetaMast.
1inch, or “DEX Agreggator”, is a tool designed for crypto arbitrage as it should be. Basically, it gathers data from around any other swap service into a single place, which then can be used to execute trades. Because it is an aggregator, not a trading terminal, you can only buy or sell crypto here.
Uniswap. Not your typical trading terminal, rather a tool for crypto swapping. Designed as DEX, it works by swapping any amount of crypto for any other crypto. It can be used as a trading tool if you plan only to buy and then sell crypto when it grows in price. As with all things DEX — no KYC required.
ApolloX. Hybrid DEX trading terminal with a bit of CEX under the hood. It’s mainly used in BTC and ETH derivatives trading as of 2022. As with dYdX and Kine trading platforms, it uses WalletConnect compatible wallets as your trading account and requires no KYC to operate in its DEX form. However, if you try to use it as CEX then KYC checks come into play.
Pick your flavor of trading, but remember: KYC is there to make CEX respect the law, and if there is none, then the same can be said about your protection.