How to buy and sell Bitcoin without KYC (without ID/passport) in 2019
The original vision for Bitcoin is peer to peer electronic cash, secured by cryptography and without the need to trust a centralized institution like a bank or company and without the need for government-issued ID. Satoshi Nakamoto describes this in his Bitcoin whitepaper: https://bitcoin.org/bitcoin.pdf
Recently some companies and governments try to restrict the use of Bitcoin as digital cash and try to regulate it like bank accounts or money transfers. They do this by requiring a video or scan of government ID such as a passport, national ID card or driver's license, which is not accessible to everyone and can cause safety and privacy concerns to many people. This means that some people lose access to Bitcoin as a safe worldwide payment method and for other people, Bitcoin loses its advantages over traditional bank transfers.
Just as you don't need to possess or show government ID to make cash transactions in real life, you shouldn't need government ID to make bitcoin transactions online.
This article will explain why KYC can cause problems for small to medium transactions, explain what problems KYC doesn't solve, and list some Bitcoin exchanges and services which stay true to Satoshi's original vision and don't require KYC for small to medium transactions.
KYC in this article refers to the requirement to provide a video or scan of government-issued ID. This article doesn't refer to simply writing name, birth date and address which is generally referred to as Level 1 verification. While pseudonymity should be possible with Bitcoin for privacy and safety reasons, simply writing contact details is more accessible and excludes less people than requiring government-issued ID.
What problems can requiring KYC cause?
Privacy issues
There are many valid and legal reasons to transact privately - whether you want to buy a sensitive product or service, want to protect yourself against becoming a target of theft, or just want peace of mind that your daily transactions aren't stored in a centralized database and visible to people you don't know. Requiring KYC makes people less likely to freely participate in the market, due to fears that their data could go into the wrong hands, be leaked or be misused.
Prevents regular transactions
KYC systems also limit regular transactions. While it is understandable to require KYC to protect against theft when buying bitcoin with a bank account or credit card (considering government ID was required to open these accounts), KYC is not reasonable for small to medium cash transactions, gift card transactions, or outgoing bank transfers.
For example, you should be able to use your Bitcoin to pay a bill or invoice, or to send money to a friend or relative - however, many KYC exchanges limit outgoing bank transfers to a bank account in your name. This makes it difficult to pay bills or send money to friends who don't have a Bitcoin address, if you don't have a bank account or want to skip the unnecessary step of withdrawing to your bank account first.
There is also no reason to require KYC for cash-to-bitcoin and bitcoin-to-cash transactions under e.g. $2500, as this amount is too small to be used for money laundering or tax evasion and doesn't fall under AML reporting laws. (In many Western countries AML reporting for cash transactions starts at around $10,000.) Just as you can buy groceries, electronics, gift cards and services with cash without government ID, you have the right to spend your cash on Bitcoin for online payments or hodling, and exchange your Bitcoin to cash to spend in physical stores. As this is a cash transaction, there is no risk of fraud, compared to bank transfers or credit card payments.
Removes access for Bitcoin from people who need it the most
Not everyone has access to government-issued ID like a passport, national ID card or driver's license, often due to bureaucratic issues, political reasons or discrimination, and through no fault of their own. For other people, it may cause them disproportionate risk to provide KYC - such as becoming a target for theft or abuse. These reasons also exclude people from accessing traditional payment methods like bank accounts or Paypal. This means that access to Bitcoin without KYC is even more important, to provide a safe, accessible, worldwide and low-fee payment method.
Buy Bitcoin without ID / Sell Bitcoin without ID
Fortunately there are many exchanges that stay true to Satoshi's vision of peer to peer electronic cash and don't require government-issued ID to access Bitcoin.
Buy and sell Bitcoin
You can buy or sell Bitcoin without KYC for cash, gift cards or bank transfer in many trusted peer to peer OTC exchanges. Many of these exchanges offer escrow/multisig and reputation system to protect from scams.
LiberalCoins https://liberalcoins.com/
Paxful https://paxful.com/
LocalMonero https://localmonero.co/
Bisq https://bisq.network/
HodlHodl https://hodlhodl.com/
Bitcoin ATMs
Many cities now have Bitcoin ATMs where you can buy or sell Bitcoin with cash, and generally have limits of $250-$2500 without government ID. Check a list of Bitcoin ATMs here:
CoinATMRadar https://coinatmradar.com/
Bitcoin payment processors
If you want to buy online but don't have a bank account, credit card or Paypal or don't want to use these methods, you can use the following trusted services to pay with Bitcoin:
TheBigCoin - Pay with Bitcoin in almost every online store https://www.thebigcoin.io
Purse.io - Buy from Amazon and pay with Bitcoin https://purse.io/
Crypto exchanges
If you want to exchange Bitcoin to other cryptos, these following exchanges are trusted and don't require KYC for small to medium transactions:
BlockTrades https://blocktrades.us/
MorphToken https://www.morphtoken.com/
XMR.TO https://xmr.to/
Binance https://binance.com/
There are more exchanges and services without KYC which aren't listed in this article. Check https://bitcointalk.org and local exchange services for more options. If you know more useful exchanges and services, feel free to write them in the comments.
If you found this guide useful, feel free to send a contribution to 1CaLCR5mGwS4FJzU1HZm9qwr5WoRYFDdyB (BTC).
This article was written by Web4Crypto. Web4Crypto offers web development, web design, programming and scripting services from $40 and accepts Bitcoin, Monero, Ethereum and other cryptos. Visit https://web4crypto.xyz for more information and a free consultation.