Onboarding/KYB Friction with Smaller Regulated Brokers

asked by u/sofia_r · 1d · 3 answers

Anyone else hitting a wall with onboarding for smaller, regulated brokers recently? Seems like the KYC/AML dragnet has gotten ridiculously tight. We're talking 3-4 week turnaround times for basic corporate accounts, and the documentation requests are often redundant or just nonsensical. It's becoming a real bottleneck for getting new liquidity providers integrated or even just opening a trading account for a new strategy. Larger institutions are often faster, ironically. Is this just the new normal, or are there specific jurisdictions/regulators making it tougher?

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Top answers

  • u/hugoschneider· 1 pts· 1d

    Definitely noticing this, especially with firms that are still scaling their compliance teams. The increased regulatory scrutiny since FTX has put pressure on even smaller entities to demonstrate a robust KYC/AML framework, which often translates to more manual review and longer turnaround times.

  • u/chrislee· 1 pts· 1d

    I've definitely noticed the same trend. It feels like the smaller brokers are overcompensating for increased regulatory scrutiny, leading to a much more cumbersome onboarding process than before. It makes me wonder if they're struggling with understaffed compliance teams, or if the regulations themselves have just become that much more demanding across the board.

  • u/kaito_k· 1 pts· 1d

    Yeah, I've definitely noticed that too. It feels like some of the smaller brokers are overcompensating for regulatory pressure, which just ends up creating more hurdles for legitimate businesses. Are you finding it's a specific type of documentation they're often getting hung up on?

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