CNBC reported that on Jan. 5, several major crypto-exchanges have begun asking U.K. customers to prove their knowledge by completing questionnaires.
CNBC reported that Coinbase Crypto.com and Gemini were among the exchanges who require this information. OKX, Kraken and other crypto exchanges have stated they require the same information.
Exchange users specifically must identify themselves as a high-net worth investor with a certain level of wealth or income, or as a “restricted investor” that won’t trade more than 10% of their assets. Users who refuse to select one of these categories won’t be able use or trade cryptocurrency on the relevant exchanges.
Users will also be required to correctly answer a questionaire in order for them to demonstrate that they understand cryptocurrency and the associated risks. CNBC reported that the test will include questions on services provided by each exchange as well as crypto price volatility and regulations. Users from the United Kingdom who do not pass this test will no longer be able to trade on any exchange.
Some crypto exchanges don’t expect a decline in usership as a result.