Changpeng Zhao, CEO of Binance has revealed how the users of Binance have perceived the mandatory KYC compliance.
Speaking in an interview, Changpeng Zhao said that after years of battling authority allegations on a global scale, it has finally taken quite the positive approach to regulatory compliance, and it actually was quite beneficial when considering the turnover of users.
The KYC – Know Your Customer protocol implemented by Binance is applicable for users globally, where new users were expected to be reached by the new regulation-compliant Binance. Nonetheless, the implementation of KYC cost Binance 3% of users, revealed Changpeng Zhao for Bloomberg News.
Cryptocurrency exchanges and traditional financial institutions both employ KYC as a standard procedure. It allows businesses to confirm a user’s identity by requiring some type of physical credentials. On August 20, Binance made KYC a requirement for all existing and new customers to access its products and services, such as crypto deposits, withdrawals, and trades and transactions.
Changpeng Zhao said “we feel that being compliant will allow more users to use us,” because users are more at ease when they operate via an exchange that is licensed and regulated.
While Binance for years flaunted the decentralized and lack of physical presence structure, Changpeng Zhao said earlier this year that Binance is now ready to impose regulations on a local level because they want to be licensed everywhere and become a proper financial institution.
Changpeng Zhao stated during the interview that while regulators were first wary of Binance, their views have improved as the company’s communications have progressed. He revealed that perceptions had changed during meetings by describing his encounters as follows: “when people see me in person, they say, ‘look, CZ is very reasonable, very calm, not a crazy guy.’ So that helps establish their trust much faster.”
Binance has opened three subsidiaries in Ireland as part of the CEO’s plan to create formal headquarters in several countries around the world. At the time, Changpeng Zhao said that Binance wanted to stay true to its decentralized idea when it first opened, but there needs to be a legal and centralized corporate structure to run a centralized exchange platform which Binance is slowly becoming.