Many of the world's top exchanges are geo-blocked, so if you are a trader, you are aware of this. That means you will not be able to use the exchange if you do not live in one of the supported countries.
Consider this scenario: you are an American who wants to trade on Binance. That is a challenge. Binance was banned in the United States in 2019. Binance, a new subsidiary, will be launched in 2022. There are fewer trading pairs and no leverage in the United States. Residents of Hawaii, Idaho, Louisiana, New York, Texas, and Vermont, however, are not eligible.
If you want to trade on Binance, you will need to sign up for a VPN. You can use a virtual private network to access the exchange as if you were in another country.
Using a VPN with a cryptocurrency exchange, on the other hand, has its drawbacks. Let us take a look at them.
Will a VPN be able to unblock cryptocurrency exchanges?
Some, but not all, websites will be unblocked with a VPN. Before increasing your deposit and withdrawal limits above 0, many exchanges still require you to complete KYC.
KYC stands for "Know Your Customer." It entails disclosing personal information and, on occasion, proving residency with photos of utility bills. It is difficult to find exchanges that do not require you to complete KYC, but here are a few that remain.
- ByBit
- BitForex
- KuCoin
Use at your own discretion.
Even if you use a VPN, you can still be geo-blocked if you have a KYC that requires you to prove your residency.
The dangers of using a VPN to access cryptocurrency exchanges
There are some risks when using a VPN to connect to an overseas exchange. The most obvious possibility is that your account will be suspended. If the exchange discovers that you are attempting to circumvent their geo-restrictions, your account may be suspended and you may be asked to provide identification or go through an inconvenient process to reclaim your cryptocurrency.
If you are still interested in continuing, keep reading to learn how to use a VPN to unblock crypto exchanges.
Do not keep your cryptocurrency on the exchange.
The first point to remember is that you should never keep your cryptocurrency on an exchange. That is because if you use a VPN, there is always the risk that the exchange will figure out you are trying to get around their geo-restrictions. If they do, they may close your account and seize your belongings. They can not do this if you buy cryptocurrency on the platform and then send it to your own wallet right away.
Always use the same server / country to access the exchange.
If you are going to use a VPN to unblock a cryptocurrency exchange, make sure you use the same server each time. As a result, your activity will not appear suspicious. It is not organic internet usage if you connect from different servers or countries every time.
Hot tip: If you travel a lot and log into your crypto exchange from a different country, you may receive the dreaded "your account has been blocked due to suspicious activity" email. A VPN can prevent this by making you appear to be logged in from the same country each time, even if you aren't.
Get a static IP Address
Get a static IP address, which is even better. An IP address that does not change is referred to as a static IP address. This is critical because some VPN services will assign you a new IP address each time you connect. If the exchange notices that you are connecting from various IP addresses, they may suspect you of fraud and terminate your account.
Spend money on a good VPN service.
If you want to use a VPN to access crypto exchanges, you should pay for a high-quality service. The free ones are well-known and will almost certainly result in your being banned. Leaving aside the security risks of installing a free VPN on a computer that has access to your crypto, all of the major exchanges are aware of the IP addresses used by free VPNs. As a result, if you connect to Binance using a free VPN, they will notice and may suspend your account.
How to unblock an account that has been blocked due to the use of a VPN
There are a few things you can do if you are using a VPN to unblock a crypto exchange and your account is blocked. The first step is to contact the exchange and inform them of the situation. They might be willing to assist you in getting your account unblocked. This is only worthwhile if you keep your cryptocurrency on the exchange, which you should not.
Some exchanges may require you to provide identification documents. This is usually a photo of your driver's licence or passport, and you will have to wait a few days for your account to be unblocked or for a final withdrawal to get your money back.
Create a new account is another option. This is not ideal because you will have to begin from the beginning, but it is better than nothing.
Let us bring this to a close.
While using a VPN to unblock a crypto exchange comes with its own set of risks, it is still a viable option if you want to access markets that are not available in your area. Just remember to take precautions like only using the same server to access the exchange, getting a static IP address, and paying for a good VPN service. And, of course, never store cryptocurrency on an exchange.