It is never hard to find a good debate on the Bitcoin subreddits, although some of them are taking things a bit too far regarding imagination. A lot of people are still taking offense to the fact Bitcoin companies are complying with certain government-issued procedures, such as KYC and AML. A side effect of this compliance leads to Coinbase customer disgruntlement, as some people feel like they are being treated like criminals just because they enjoy using Bitcoin. But is there some truth to these claims, or are people starting to see conspiracy theories everywhere?
Coinbase Is Labeled As a Systemic Risk
Popular Bitcoin companies will have no trouble attracting a lot of attention, although that may not always result in positive comments. Especially when it comes to verifying user identities in the Bitcoin world, things can get quite hairy. A lot of people value their pseudonymity, and the compliance with existing AML and KYC guidelines force Coinbase to ask for identity documents, which are then stored on behalf of the government.
Additionally, whenever issues on the Coinbase platform arise, some people feel they are being victimized for whatever may have taken place. One Reddit user even went as far as saying how Coinbase support treated him like criminals on parole, and how bitcoins are being held “hostage’ for lengthy periods of time.
Whether or not there is any truth to these allegations, remains to be seen. However, people also need to take into account they decided to use a centralized exchange platform in the first place, rather than look for alternative options to buy and sell Bitcoin. The more people trust this kind of platforms, the more powerful they will become in due time.
Bitcoin was never designed to be used by third parties and centralized companies. Unfortunately, most of the modern exchange platforms in existence act as a custodian of consumer funds, either in fiat or digital currency. If users do not want to deal with “issues” such as following Coinbase guidelines while they try to abide by a set of rules, they should never use platforms like Coinbase in the first place.
That being said, the requirements forced upon Bitcoin exchanges by governments are quite worrying to say the last. Verifying user’s identity is one thing, but having to store that information and making it accessible to the government is a different matter entirely. Peer-to-peer solutions are available, yet vastly underutilized and underappreciated by the average Bitcoin user.
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