[blunte]

The KYC/AML regulations require essentially 1:1 human effort for every new person who attempts to buy any practical amount of cryptocurrency (within the US and EU, and probably elsewhere).

So the #1 problem is that people who want to buy some cryptocurrency cannot. They wait days or weeks to get verified. And the exchanges and money changers want to provide the virtual currency to the hungry customers, but they cannot afford to hire enough people to process all the verification applications.

Given this extreme bottleneck, I don't see the significance of news about how much easier it is for people to spend virtual currency.

Ironically, Coinbase is one of the most complained about in terms of slow verifications.

[vosper]

I'm in this boat now - I've been a Coinbase customer for years, and then randomly they blocked my ability to withdraw my money (MY money, BTW) from the account. Nothing had changed about my account setup.

Now they want me to go through the Photo ID process, but I don't have a US drivers license, only a permanent resident (green) card for ID. Which should be fine, after all it works as ID for literally everything else I could need ID for in the US - including flying. Support have been fairly responsive, but they keep sending me back to through their photo verification process, and I keep telling them "but this is not a driver's license, please look at the pictures!".

It's really annoying - this is a federally-issued photo ID I'm required to carry with me, and yet Coinbase seems to be struggling to accept it. In the meantime my money is stuck and I don't know how to get it back.

[htormey]

Fellow greencard holder here, I’m in the exact same boat with coinbase. I’m booking an appointment at the dmv to get a new ID card just for this. It really sucks.

[mancerayder]

The error of the ways of Coinbase seems to be allowing various transactions and money transfer activity, sometimes for lengths of time, on unverified accounts. Then, suddenly boom, there's a problem, and customer support is already backlogged.

Kind of like they opened the door to unlimited new subscribers and sobbed that they were overloaded. With some of the HN crowd playing the violin music of poor, fast-growing start-up (the "growing pains" cop out).

Naughty (greedy) Coinbase.

[vosper]

Yeah what's particularly frustrating is that I'm not a new user, I've had an account for years. If I had a problem signing up, and couldn't start using their service, that would be one thing, but that I already have money in there and they're preventing me from getting it back is what's really frustrating me.

[tonyhb]

Each state has different laws regarding KYC, AML and money transmitter status. For example, in all states but California payroll companies are money transmitters.

It's annoying, but requiring a state-issued ID instead of a federal ID satisfies some of their legal requirements and makes the verification process much easier on their side.

Could they do this with a federal ID? Probably. It'd be a completely new verification process - not automated. They may need to request recent bills for proof of address, plus the necessary tooling to store/verify these.

It's the same reason you can't wander into a bank with a green card and be like "open an account". You need proof of address, state residency etc.

[woolvalley]

Could you get a state id as a workaround? Most states issue IDs that pretty much look identical to a drivers license, but are not a drivers license. Much faster turn around time, no real testing required.

[beaner]

It only takes about 10 minutes to get verified on Coinbase. The majority of people are done in this amount of time. It's when something goes wrong and you can't get a response from customer service that is a problem. After all this time, it still sucks.

[blunte]

Here's tip for getting past the automatic verification failure problem on Coinbase: after failing, try their mobile option. For whatever reason, the mobile option (where you take a photo of your ID with your phone) seems to work much more reliably than the computer method.

[lewi]

When I first bought ETH (Coinbase) it took 5 min verification and a debit card. Practically instant in comparison to traditional financial setup times.

[dimillian]

Verification is not done by humans, and it's instant.

[RickS]

It's not that simple. Instant verification is shaky and relies on 1) the ability for a computer to properly read your document and 2) the information it reads to exist in a 3rd party repository of your personal information (these are terrifyingly vast).

If 1 or 2 fails, which they do often, you're back in human land.

[bobwaycott]

There are a significant amount of stories out there (and shared here) that directly disagree with your assertion.