What kind of private information would a bitcoin "middleman" ask from clients?

Question

I don't know much about bitcoin so forgive me for the ignorant title and terminology. My mom recently got into bitcoin and told me she was investing her money in it or something like that and she's been doing these transactions through a company (whom I referred to as "middle men" in the title). These middle men recently asked her to provide pictures of her passport with her in it hold it up and also a pic of her credit card bill with her in it as well ; apparently to verify that she's a resident where we live (in Hong Kong, China).

I thought it was a bit suspicious that they asked for such private information. Is this a normal practice of bitcoin middle men/compamies?

Answer 1

When dealing with established companies as a middelman (usually an exchange), it is common to go through a form of know your customer (KYC). This usually involved some form of national ID, and a bank statement or other proof of residence/address, and is usually done to comply with local laws regarding movement and sale of currencies.

You should, however, be extremely wary of dealing with random companies or people. Make sure you are dealing with a reputable exchange (check review on reddir, yours.org, steem, and other such platforms), and as far as possible, keep any BTC or other crypto in a wallet where you control the private keys (such as electrum, Ledger, Trezor etc). If someone offers to do mining on your behalf, it is almost certainly a scam. If someone says you need to pay to unlock the BTC, it is a scam.

Verify you are dealing with a legitimate entity.

Answer 2

If the "MiddleMan" is a regulated exchange they would have asked for ID before you could begin trading with them, if on the other hand it is something like localbitcoin.com where you are dealing with individules they all have their own country specific ID rules if required by law so from reading your post it would seem to be a scam as 1. They would have asked before trading. 2. If you are already trading with them why do they need ID, all of a sudden.3. So called BitCoin Lending or Investements where you get Interest Paid Daily are also a Scam as if they actually were capable of paying such high interest, everyone involved would be either a Millionair or Billionair very quickly and every Bank, Hedge Fund etc. in the World would be doing it, even Government People, so if it were me i would not send any id & stop trading with them. "As the saying goes if it`s too good to be true it usually is" Let the Buyer Beware.