Major global cryptocurrency exchange Bitstamp continues increasing compliance efforts by requesting its users to provide more data like their source of wealth.
In an email notification to users on Wednesday, Bitstamp informed its customers about the ongoing policy upgrades on the platform, with the exchange seeking additional info about its clients, one Bitstamp user told Cointelegraph.
The email reads:
“We work closely with our regulatory partners to ensure we continue to be your trusted exchange. Towards this, we need your account information to be updated, to provide you with the latest products and crypto assets.”
Bitstamp specifically requested users to update the origin of cryptocurrencies stored on the platform for regulation purposes.
The exchange provided an official list of examples of documents clarifying fiat-related sources of wealth of deposited funds, including salary and pension payslips, inheritance documents, payslips for savings, gifts, mining receipts and others. Crypto-related sources include fiat and crypto deposits and withdrawals, login info, work contracts, screenshots, hand-written agreements and others.
The exchange now also requires its customers to provide some legal info like nationality, place of birth and tax residency. Additionally, the exchange requested info on annual income and net worth, intended activities on the platform, annual deposit estimation as well as the source of assets.
Prior to sending the latest notice, Bitstamp reached out to its users on March 30, promising rewards for providing more account info:
“If you want to keep on using our services, you’ll need to update your account as some information is out of date. As a "Thank You!" we will reward you with a $25 bonus once you have completed your account info.”
Those who haven’t updated their account have not only missed the bonus but are also at risk of not being able to withdraw their funds from Bitstamp. According to social media reports, Bitstamp has disabled all cryptocurrency and fiat withdrawals for its European customers who have not proven the origin of their crypto on the platform.
The exchange now reportedly asks users to provide documents verifying where they got the crypto that they have deposited on Bitstamp. However, this only applies to cryptocurrencies bought on external exchanges.
The community has expressed outrage over the policy changes at Bitstamp, with people complaining about Bitstamp not giving them time to withdraw their crypto before announcing the new rules. “You just can't provide new rules when people have already deposited their crypto. If you want to change the rules of the game, you have at least given them a deadline before,” one Redditor wrote.
“We understand that not everyone is comfortable with providing so much information and we especially understand it is very inconvenient. However, please understand that we have to meet the demands of our regulators if we want to keep providing you with our services,” a Reddit user named “Lucas from Bitstamp” wrote in the thread.
Bitstamp did not immediately respond to Cointelegraph’s request for comment. This article will be updated pending new information.
Related: Crypto industry fires back after EU vote to block ‘unhosted’ wallets
The latest restrictions on Bitstamp are not the first time that the exchange has adopted Know Your Customer (KYC) measures. The firm previously adopted somewhat strict policies for withdrawals by its Netherlands-based users, banning withdrawals to external wallets from unverified addresses.
As previously reported, the European regulators were seeking to amend the European Union’s Transfer of Funds Regulation in late March, proposing to report all crypto transfers above 1,000 euros ($1,086) to relevant authorities.
Additional reporting by Tom Farren.