Apart from data analysis carried out alone or in cooperation with private companies, authorities may request information from central exchanges. Due to regulation, centralized exchanges may also be obligated to share this information. However, not all cryptocurrency exchanges cooperate with the authorities.
A central exchange is a cryptocurrency exchange operated by a single entity, such as Coinbase. To become a licensed operator in a particular country or territory, centralized exchanges must comply with the regulations.
For example, to reduce cryptocurrency anonymity and illicit use of cryptocurrency, most centralized exchanges have integrated Know Your Customer (KYC) checks. KYC aims to verify customers &[رسقوو]; Identities combined with helping authorities analyze activity on the blockchain. Practically speaking, individuals need to provide a set of documents and their data before they are allowed to trade, invest and transact.
After an KYC procedure, exchanges may be required or required to share that data with law enforcement agencies. Since the stock exchange has individuals &[رسقوو]; Personal data and transaction data, as well as government. Using information obtained from central exchanges, the IRS can identify unknown Bitcoin wallets using KYC checks and corresponding personal information. & nbsp;
However, not all exchanges use KYC. For example, it is difficult to get decentralized exchanges (DEXs) to comply with regulations because they lack a headquarters and are not run by a central company or a small group of individuals.