Things are not looking all that great for the BitGrail service right now. As the company is being forced to verify users’ identities, they have a lot on their plate. Moreover, it seems they will only verify the identities of their European users. It is a bit unclear what this means for the company as a whole, though. Some users expect BitGrail to leave non-European customers in the cold, but that doesn’t appear to be the case just yet.

What is Going on With BitGrail?

Some cryptocurrency enthusiasts may be familiar with the BitGrail project. This cryptocurrency exchange has become somewhat popular over the past few months, mainly thanks to the addition of Raiblocks. It even opened up a separate market for Raiblocks, which is now the second “base currency” traded against the likes of Ethereum, Litecoin, Bitcoin Cash, and Lisk. Even though they do not process fiat currency transactions, the company will need to undergo some big changes.

According to a recent Reddit thread, the BitGrail platform will enforce KYC verification in the near future. This seems a bit odd for a company not dealing with fiat currencies, but it seems that is the unfortunate reality regardless. The company will make KYC mandatory, which makes sense, given its UK-based operations. The entire world is cracking down on anonymous cryptocurrency trading activity, and it’s always best to remain ahead of the curve.

This news is positive for the company, but its user base isn’t too happy with the new requirement. BitGrail wants to operate in a transparent and legal manner first and foremost. Especially for a company dealing with overseas customers – primarily from the United States – implementing KYC procedures is more than warranted. FinCEN has advised all cryptocurrency exchange operators to avoid civil and criminal penalties. To do so successfully, overseas MSBs will need to verify the identities of all their users. It makes a lot of sense on paper, but it’s not a popular decision.

One possible downside to this new procedure is that BitGrail may no longer be able to service particular users and regions. The Reddit post authored by the company’s CEO mentions that the team will “verify users to determine if they could use BitGrail or not”. It is this wording which seems to irk a lot of users, although there doesn’t appear to be any reason for that. The company does hold the right to terminate unverified accounts if needed, but it seems unclear that they would do so anytime soon. They want unverified and extra-EU users to close their accounts first and foremost.

Furthermore, it seems BitGrail has halted all withdrawals and deposits of Raiblocks until further notice. This also applies to LSK and CFT token transfers. Bitcoin withdrawals will remain unaffected until all of the proper changes have been put into place. Users who are forced to close their accounts will only be able to withdraw Bitcoin, as all their outstanding balances will be converted to BTC. This is another unpopular decision and one that will create a lot of backlash. BitGrail is not doing anything illegal in this regard, though.

It is evident this news has caused a lot of confusion and anxiety. It is also understandable that a lot of users are not happy with these decisions right now. Some people are even speculating that the BitGrail team wishes to pull an “exit scam” and collect as many XRB as they possibly can. Whether or not that is the case remains to be determined. Rest assured other small exchanges may take similar actions in the future. Anonymous cryptocurrency trading on centralized platforms is slowly coming to an end.