Bitcoin ATM provider Robocoin said it will start collecting the customer data in order to meet the know-your-customer (KYC) standards.
The move is rather a necessity, given the recent closures of non-compliant ATMs and the actions of The Financial Crimes Enforcement Network (FinCEN) taken to provide more clarity to the bitcoin ecosystem. Moreover, the compliance with KYC regulations is required if the company wants to ensure further promotion of the digital currency to the world market.
The company stated in its official blog: “We hoped operators would always get to choose KYC vs Non-KYC, but legal requirements have emerged that do not allow the choice. It has become clear that as a registered money service business (MSB), Robocoin cannot support non-KYC machines anywhere in the market. Under our lawyers’ advice, we cannot process anonymous financial transactions. Our operators must comply with know your source and know your destination requirements. Disabling KYC and allowing anonymous transactions create money laundering risks. We cannot violate the law or risk the long term viability of Robocoin and our global Robocoin Operator network.”
Robocoin CEO Jordan Kelley said it was a difficult decision, however, it shows the company’s commitment to expand the bitcoin adoption.
“We’re listening to the world,” Kelley said. “The world says ‘we demand more access to bitcoin’. We want to provide that, but we cannot provide that with a few machines with our brand on them that are engaging in non-compliant activity.”
The company’s operators will also have to upgrade to the Robocoin 2.0 platform, which stipulates that ATM customers will use Robocoin’s new proprietary wallet.
Kelley noted the new 2.0 platform has easier interface, is compared with the previous one.
“With our new software, customers walk up to the machine for the first time, put in cash, get a bitcoin wallet made right there, and then have the ability to send that bitcoin to another person anywhere else in the world, or send it to their own wallet,” he said.
The company also stated the legal compliance is vital to the firm’s continued legal operation and it cannot risk the future of the company by allowing anonymous transactions. Moreover, the anonymity rises the risks of money laundering.
“There are some guys in some markets who want to be the only one and they want to own that machine,” Kelley said. “Our logic is that we want a machine on every corner to make sure we can deliver on the promise of bitcoin.”
Besides, the changes will likely appeal to the potential business partners. “Big companies do not want to do business with guys who have machines that are non-compliant,” Kelley said.