Most cryptocurrency exchanges and purses in the US and the European Union do not fulfill the requirements for the identification and verification of users of financial services, the study says.

68% of the 25 exchanges and wallets allow users to perform trading operations with cryptocurrencies without passing mandatory identification and verification process, demonstrates the research of the consulting company P.A.ID Strategies.

The list of analyzed companies include 18 well-known cryptocurrency trading platforms (Kraken, Coinbase, Gemini, Poloniex, Bitstamp, ItBit, CEX, Coinexchange, Exmo, LocalBitcoins, YoBit and others), as well as 11 wallets (Luno, Bonpay and Mercatox and others). To start bidding, users only need to register and confirm their email or phone number.

“Cryptocurrency wallets and exchanges want to enjoy the same trust as the wider traditional financial services, but for this to happen they need to rise above the sometimes-dubious reputation of cryptocurrency’s past and be seen as ‘model citizens’ of the economy,” John Devlin, an analyst at P.A.ID Strategies, said.

The situation may change in 2019, when all countries of the European Union will have to comply with the new AMLD5 anti-money laundering directive, which requires financial services operators, including those working with cryptocurrencies, to request detailed identification information from their users. The Directive came into force in December 2017, but it must be enforced by all EU members 18 months after that date, that is, by the summer of 2019.

The new directive can significantly affect the reputation of this sector, which so far resembles the Wild West, Devlin added.