Recently, Erik Voorhees, the Founder of ShapeShift spoke about ShapeShift’s new KYC/ AML policy, and the regulation of the cryptocurrency space, during a discussion with Naomi Brockwell on Youtube.
ShapeShift, one of the leading cryptocurrency exchange platforms around the world, recently implemented know-your-customer and anti-money laundering policy on their platform. The exchange was well-known in the space for the users not requiring an account to avail services offered by the platform. This was the main reason the news of a mandatory KYC/AML policy set the space ablaze.
The policy was introduced in early September 2018 named ShapeShift membership. The program required users to open an account and provide basic personal information.
Erik Voorhees said that he has a lot of problems with the implementation of the policy on the platform. He said:
“We’ve since, just about a month ago changed that model to require accounts and we have to do KYC on users now, which means know-your-customer, which is a Orwellian construct to basically enlist private companies to do government surveillance for the government, that’s pretty endemic in all financial companies around the world at this point.”
The CEO further added that the there is going to be a “constant struggle” with governments and SEC in terms of regulation of the cryptocurrency space. Voorhees stated:
“So crypto generally blurs a lot of legal boundaries and creates a lot of gray area and that gray area is getting figured out; the private companies that are involved don’t understand it all, the government agencies that are involved don’t understand it all and it’s gonna be a tension and struggle, I think for the next decade.”
Voorhees also spoke about the KYC/AML policy implemented by IDEX, one of the biggest decentralized exchange platforms in the space. The news regarding the decentralized exchange platform broke-out yesterday. The reason for the policy, as stated by the platform, was to comply with sanctions and money laundering regulation.
“I was curious if that was gonna start happening. I didn’t think it would happen so quickly”
The early Bitcoin adopter further stated that decentralized exchanges are, in reality, a hybrid platform, wherein a company is operating it but its model parts are distributed in a way that the funds are not held or passed through by them. For such an exchange platform to implement the policy, he believes it “moves the needle a little further”.
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