HitBTC users are being asked to provide excessive detail about the derivation of their funds, according to multiple sources. Even Bitcoin developer Luke-Jr was forced to undergo KYC in order to withdraw funds. The famous small-blocker reportedly had chosen the exchange for its perceived lack of know-your-customer compliance.
The unusual request for further information is viewed as a violation of the user’s privacy and an attempt to simply withhold the funds. Meanwhile, other users claim that their funds have been stopped with limited response from customer support, sometimes for weeks on end.
It’s unclear if these demands are even in compliance with the laws that exchanges must abide by or what laws HitBTC is purportedly trying to respect. Various professional services exist, such as Chainalsysis, which are meant to help companies verify the legitimacy of crypto funds.