Know-Your-Customer is the most consistent friction in crypto banking. Every regulated entity does it; the depth varies.
What basic KYC asks
The standard data set:
- Identity: Government-issued photo ID (passport or national ID card). Sometimes both sides.
- Address: Utility bill or bank statement within 90 days, showing your name + current address.
- Selfie / video: A liveness check (recorded selfie or 15-second video saying a phrase). Confirms the ID is yours, not stolen.
- Source of funds (declaratory): A dropdown — salary, investment, inheritance, business income.
- Tax residency: ISO country code. Triggers DAC8 reporting in the EU.
Time to complete: 5-15 minutes for most users, including upload time. Automated review takes 1-3 hours for standard cases; manual review can be 1-3 business days.
Enhanced due diligence (EDD)
Triggered above thresholds or by risk flags. EDD adds:
- Source of funds (documented): Pay slips, bank statements, sale contracts, inheritance documents. Multi-page PDFs.
- Source of wealth: Bigger picture — how did you accumulate the assets you're transacting with?
- Politically exposed person (PEP) check: Public databases of politicians + family members.
- Sanctions screening: EU consolidated list, OFAC SDN, UN, plus jurisdiction-specific.
EDD review takes 3-10 business days. This is the part that catches first-time large-amount users by surprise.
Why thresholds matter
Different thresholds trigger different friction:
| Threshold | Triggered checks |
|---|---|
| Account opening | Basic KYC |
| €1k single tx | Travel Rule auto-fill |
| €5k cumulative monthly | Source-of-funds declaration |
| €10k single tx OR €50k cumulative | Full EDD review |
| €100k+ | Manual relationship-management contact |
The wallet's Off-Ramp dashboard shows the relevant thresholds for the selected CEX so you can plan.
KYC at the receiving bank
Your existing bank (where the EUR lands) sometimes also asks questions:
- First large crypto-related deposit (>€10k): they may flag for review.
- Pattern: regular crypto-related deposits totalling >€20k/month may trigger relationship-manager review.
- Origin questions: "where did the crypto come from?" — answer truthfully + briefly.
Banks vary wildly. Some German banks (DKB, ING, Comdirect) are crypto-friendly and rarely question routine crypto sales. Others (Sparkasse, Volksbank) are more cautious and may pause large incoming SEPA transfers from CEXes for manual review.
The wallet's Off-Ramp partners section lists known-friendly banks in your jurisdiction.
How to make KYC go smoothly
Three rules:
- Use real data. Anything that doesn't match your ID will be caught at automated review. Save yourself the rejection.
- Upload high-quality scans. Glare, blur, cropped corners — all rejected. Use direct sunlight, no flash, full document visible.
- Have source-of-funds documents ready. If you're going to off-ramp anything substantial, gather your pay slips, sale contracts, etc., before starting.
The "no KYC" trap
Some platforms offer "no-KYC" off-ramps. The actual options in 2026:
- P2P trading (LocalBitcoins-style): person-to-person SEPA/cash sales. Quasi-legal in most EU; counterparty risk is real (escrow scams).
- Bitcoin ATMs: 5-10% fees, low limits (€500/day typical), still mostly KYC'd in EU.
- DeFi-only off-ramps: don't exist for fiat. You'd need someone willing to take crypto in exchange for fiat handed over off-platform.
The wallet doesn't expose any "no-KYC" off-ramp. All integrated partners are regulated.
What KYC doesn't protect against
A common misconception: completing KYC means the CEX won't freeze your account or refuse withdrawals. False.
CEXes can freeze:
- Suspected fraud (someone reports your wallet address)
- Sanctions screening match (you share a name with a sanctioned person)
- Operational issues (the CEX itself gets sanctioned — Bittrex 2023)
- Bankruptcy (the CEX fails — FTX 2022)
KYC moves the risk from "regulatory" to "operational and counterparty". Different risk, not zero risk.
Next: what your bank sees when crypto-related EUR arrives.