🚫 KYC Warnings 🎒WTF is blockchain? — Cryptos for the Rest of Us

Market’s have finally broken their rangebound trading with BTC dropping to trade below the $4,000 handle. This extends losses for the year to a whopping 73% for BTC, a far cry from the bull run going on this time last year!

KYC Warning

What’s the Story?

Many ICOs have started to operate in a semi-regulated manner. As a result, they are asking for KYC documents such as passport scans and selfies from interested investors. Handing over this information can be risky and this information can be sold and/or used for identity fraud.

What KYC (Know-Your-Customer)?

Most financial regulations require operators to know and verify the identity of their customer. This is to prevent financial fraud and money laundering.

With regulations encroaching on cryptos, we’re seeing ICOs require prospective investors to be ‘whitelisted’ before they can participate in the token sale.

This usually requires customers to upload a selfie of them holding their passport or identity document. Sometimes this is fully automated, sometimes it is verified by a human operator through a video call.

What’s the risk?

The average price of a digital passport scan on the dark web is $15. If you add proof-of-address or proof-of-identification then that prices jumps to $61.

If an ICO is simply a scam, then they can earn a whole lot more money by selling this information through the dark web.

Once the information is out there, identity theft becomes very easy. In the crypto world, this can mean hackers reseting users’ passwords to their KYC-verified exchange accounts. Exchange’s with two-factor-authentication (2FA) often allow 2FA to be removed through KYC verification in case the token generator is permanently lost.

Outside of the crypto world, one of the most common scams is to take out multiple loans under the fraudulent identity. Often, victims only realise years after the fact when they get rejected for a loan, or find their credit score ruined.

How can I protect myself?

Ideally, you would never have to give such information out.

If you do, spend time researching which KYC platform the ICO is using. If the KYC is handled internally that’s a big red flag.

There are many third-party, blockchain based solutions cropping up these days. If the solution is a well-regarded operation that somewhat lowers the risk.

When submitting this information it can be useful to watermark the photos you upload with the name of the provider/s and purpose of upload. This makes is much harder to use the documents for anything other than their intended purpose.

WTF is Blockchain?

A collection of new resources that explain how the blockchain works in text, comic, and dance form!

TEXT: Edward Snowden Explains Blockchain to His Lawyer


A good exchange of messages between Edward Snowden and his lawyer, who seemingly knows next to nothing about blockchain. It goes into reasonable depth about both practical use cases and the mechanisms that power distributed ledgers.

COMIC: Bitcoin White Paper Webcomic

 Famed illustrator and comics theorist Scott McCloud takes readers on a fantastic and educational journey through the Bitcoin whitepaper. McCloud’s fun and insightful narrative teaches the basics of Bitcoin, a peer-to-peer electronic cash system, to experienced cryptocurrency fans and beginners alike.

DANCE: How to dance the Blockchain


Taking a more artistic turn — here’s the blockchain technology explained with dance. While not entirely accurate it’s an interesting representation of how proof-of-work is used to add transactions and blocks to the chain.

Liked this publication? Follow it and let me know! 🎉