Telegram, one of the world’s most-used messaging applications, has recently made a very important move regarding its service provider and KYC policies. Earlier, users could use the Telegram wallet’s default version without sharing their data. However, things are about to change here.
This new update will take effect on June 3, 2021, and requires Telegram users to provide more information for most wallet services. The notice also noted that for all the default services, except the withdrawal function, users must provide their name, phone number, and date of birth.
This shows that Telegram is increasing its measures in the KYC process since the platform aims to improve its security features and follow the rules set by the authorities. People who have had the chance to use the platform’s services with the wallet aspect in the past may have noticed a change in their ability to access wallet services anonymously—a change that the platform now demands a more strict approach to identifying its users.
Three levels Of the new KYC system
The new KYC system in Telegram has developed a three-level identification process for its users.
Users will be required to input their name, phone number, and date of birth, which is the most vital information. This level provides daily transactions up to €3,500 (equivalent to $3,780) and up to €35000 (equivalent to $37,800). However, these may differ depending on the local exchange rate.
The next level of verification entails the user producing a national identity document. It also enables much higher daily and monthly transaction amounts with the limits set at €100,000 ($108,000) per day and €1 million ($1. 08 million) per month.
Last, the highest verification level is when users are asked to enter their home address. This eliminates all the high transaction limits and provides users access to all the financial services offered by the platform.
The(se) features show that Telegram has put a lot of effort into ensuring that its platform is secure and meets the set compliance standards while allowing different levels of access to users depending on the level of their verification.
Service provider change and impact on transactions
Telegram’s Wallet service is being modified, but these alterations do not affect the TON Space function. A self-custody sub-wallet of The Wallet planned for the future will allow distributed swaps and non-fungible token transfers. However, these changes will greatly limit Card transactions and P2P payments, discouraging consumers from using Cards frequently.
Also, Telegram has disclosed that the Wallet’s service provider has changed. From 30 May 2024 onwards, WOT Global Solution will provide the Wallet’s services. This transition will ensure that all user data, such as names, addresses, telephone numbers, and transactions, will be forwarded to the new provider. Users who do not want their data to be transferred can cancel their Wallet accounts by May 20.
Telegram, however, has its Wallet as a custodial service, unlike self-custodial wallets such as MetaMask, Trezor, or Ledger, where users hold their keys to their assets. Since the cryptocurrency is held by a third party who owns it, the platform can impose KYC procedures and limit transactions. Halil Mirakhmed, the COO of the Wallet company, explained that the choice of the custodial solution was to facilitate the user onboarding process.
