Wouldn’t the world be a better place if you could swap your crypto to fiat in one, seamless move? Cryptocurrency wallet MyEtherWallet (MEW) and the crypto finance platform Bity have partnered to do precisely that. Their newly launched service allows users to conveniently swap Bitcoin and Ethereum for Euros or Swiss Francs, allegedly without undergoing KYC.
How it Works
MEW’s withdrawal service works by integrating with Bity’s fully regulated and audited brokerage company. Bity provides a crypto-to-fiat gateway through its compliance with the Swiss Anti Money Laundering Ordinance (AMLA).
The process of withdrawal happens directly within the MEW interface. You’ll need to log into your wallet and head over to the ‘swap’ option. From there you’ll be asked which currencies you’ll be exchanging, and voila!
The next steps are more time consuming and require information that you might not have on hand. It’s here that we question if MEW’s KYC-less claim is more of an exaggeration than reality.
Currently, this service only works for users with a Swiss or European bank account. Bity doesn’t have regulatory clearance to settle payments in US Dollars. The maximum withdrawal amount (for now) is 5,000 CHF (Swiss Francs).
Is it Really KYC-less?
This is the big question everyone is asking. Since a KYC-less exit-to-fiat is a big deal in the world of cryptocurrencies, there’s a lot of pressure on companies to provide this service.
So, is MEW’s new service actually KYC-less? No. Although you don’t need to provide the extended list of details found in KYC forms, you must provide identifying documents. Let’s take a look at what is required from MEW:
- Your phone number
- Banking details (IBAN, BIC/SWIFT, ABA)
- Official name on your bank account
- Billing address
Besides the requirement of a selfie or passport photo, this list looks exceptionally similar to KYC forms. If you thought you’d be able to cash out without any identifying documents, then you’re sadly mistaken. All of these details show precisely who you are, where you live, and where your money is going.
Also, the maximum withdrawal is 5,000 CHF annually. It seems that many crypto enthusiasts missed that last word when they all collectively praised MEW for this offramp. Most people withdraw far more than 5,000 CHF from their regular bank accounts annually.
On on a positive note, there shouldn’t be any space for crypto critics to claim that this option offered by MEW will increase money laundering. A total of 5,000 CHF annually is far too little for anyone remotely involved in money laundering. This service seems geared towards users looking to pay for daily necessities when on the go, such as a coffee or lunch.
Since your bank account is directly tied to the transactions performed through MEW and Bity, a traceable record will always be available to authorities. This means that if crypto is taxable in your country, then avoiding taxes won’t be as easy as you thought.
The Importance of a Crypto-to-Fiat Gateway
The revelation that MEW and Bity would provide users with a cashout method came as a surprise to the entire crypto-industry. The lack of direct exits for cryptocurrency users is one of the main limiting factors in its use.
Crypto projects describe their digital tokens as a store of value or as a replacement for fiat. While users can pay for goods and services with crypto, questions of cashing out continue to plague the entire industry. Although the excitement surrounding MEW’s new service is overly optimistic, it’s still a move in the right direction.
Adoption of cryptocurrencies will only happen once the user experience is as seamless as using payment platforms such as Venmo and PayPal. With these services, you can cash in, cash out, and pay whomever you please. Since exiting from crypto to fiat requires you to jump over hurdles, it diminishes the overall experience.
The crypto industry is still very young, and all the regulatory framework is still being put together. Although MEW’s exit gateway is lackluster due to its tiny withdrawal amount, it still shows that moves are being made to improve our experience.