Bitstamp, a major global cryptocurrency exchange, continues to increase compliance efforts by asking its users for more information such as their source of wealth.
Bitstamp sent an email to its users Wednesday informing them about ongoing policy updates on the platform. The exchange also requested additional information about its clients. One Bitstamp user shared this with Cointelegraph.
The email reads:
We work closely with our regulatory partners in order to continue to be your trusted exchange. To do this, we will need to update your account information in order to provide you the most recent products and crypto assets.
Bitstamp asked users to change the origin of cryptocurrency stored on the platform in order to comply with regulation.
Bitstamp requires the following information. Source: Bitstamp
The exchange provided an official listing of documents that clarified fiat-related wealth sources for deposited funds. This included salary and pension payslips, inheritance documents, payslips to save, gifts, and mining receipts. The crypto-related sources are fiat and cryptocurrency withdrawals, login information, screenshots, work contracts, and other hand-written agreements.
Customers are now required to provide legal information such as their nationality, tax residency, and place of birth. The exchange also requested information such as annual income, net worth, planned activities on the platform and annual deposit estimation, as well as the origin of assets.
Bitstamp: Information and documents Source: Bitstamp
Bitstamp contacted its users March 30 to inform them of the new notice. They promised rewards for providing additional account information.
You will need to make changes to your account if you wish to continue using our services. We will give you a $25 bonus as a thank you for completing your account information.
People who don’t update their account are not only missing the bonus, but also run the risk of not being allowed to withdraw funds from Bitstamp. Social media reports claim that Bitstamp eventually stopped all fiat and cryptocurrency withdrawals to European customers who had not proven the origin of their crypto.
According to reports, the exchange is now asking users to show documents proving where they obtained the crypto they have deposited on Bitstamp. This applies only to cryptocurrencies purchased at other exchanges.
Bitstamp’s policy changes have been met with outrage by the community. People complained that Bitstamp didn’t give them enough time to withdraw their crypto before they announced the new rules. People who have already made deposits to their crypto can’t be given new rules. Redditor: “If you want to modify the rules of the game you must at least give them a deadline.”
“We know that not everyone feels comfortable sharing so much information, and we are very conscious of the inconvenience it can cause. But, we must comply with the regulations if we are to continue providing our services,” wrote a Reddit user “Lucas of Bitstamp”.
Cointelegraph reached Bitstamp but they did not respond immediately to our request for comment. In the event of new information, this article will be updated.
Related: The EU votes to ban ‘unhosted wallets’ in crypto industry
Bitstamp’s latest restrictions are not the first time that the exchange has adopted Know Your Customer (KYC), measures. The exchange previously had strict policies regarding withdrawals for its Netherlands-based users. It prohibited withdrawals to unrecorded addresses and banned withdrawals to external wallets.
As reported previously, European regulators sought to amend the European Union’s Transfer of Funds Regulation in March. They proposed to report crypto transfers exceeding 1,000 euro ($1,086) to the relevant authorities.
Tom Farren also contributed additional reporting.