In the evolving world of cryptocurrency, regulatory standards are continuously being updated to enhance security and transparency. One significant development in this area is the introduction of the Satoshi test, a method designed to help users verify control over their private wallet addresses in line with global compliance frameworks.
This article provides a clear, step-by-step guide to understanding and completing the Satoshi test, ensuring you can navigate the process with confidence and ease.
Understanding the Satoshi Test
The Satoshi test is a verification procedure used by platforms to confirm that a user has control over a self-hosted or external cryptocurrency wallet address. It involves sending a small, randomly generated amount of crypto—typically valued between $1 and $10 in USDT—to a specific address provided by the platform. This transaction must be completed within a strict time window, usually 90 minutes.
This test is aligned with international regulations, including the Financial Action Task Force (FATF) recommendations and the Travel Rule, which requires that virtual asset service providers (VASPs) collect and share information about certain cryptocurrency transactions.
Why the Satoshi Test Matters
Complying with verification processes like the Satoshi test is essential for maintaining the security and legitimacy of cryptocurrency transactions. It helps prevent fraud, money laundering, and unauthorized transfers by ensuring that users truly own the wallets they use for withdrawals or deposits.
Key Requirements to Pass the Satoshi Test
To successfully complete the Satoshi test, you must meet the following criteria:
- The test deposit must be sent from the exact wallet address you are trying to verify.
- The deposit must be sent to the verification address provided by the platform.
- The amount deposited must match the specific value requested for the test.
- The transaction must be completed within the allotted time limit.
Failing to meet any of these conditions may result in a locked deposit. In such cases, you may need to provide additional information about the sender to unlock the funds.
Pros and Cons of the Satoshi Test
| Pros | Cons |
|---|---|
| Reliable method for confirming control of a private wallet address. | Requires meeting multiple specific criteria. |
| Supported on most major blockchain networks (excluding BTC Lightning). | Users are responsible for any network fees incurred. |
Step-by-Step Guide to Completing the Satoshi Test
Follow these steps to verify your wallet address using the Satoshi test.
1. Initiate the Verification Process
During the withdrawal process on your platform, you may be prompted to specify the destination of your funds. If you select Private wallet, you will typically have two verification options:
- Digital Signature: A fee-free method, but not supported on all networks.
- Satoshi Test: Often used when digital signatures aren’t available.
Choose Satoshi test and click Next to proceed.
2. Start the Verification
Once you select Start verification, a countdown timer will begin. You must complete the entire process within the time limit—usually 90 minutes.
3. Make the Deposit
You will be directed to a deposit details screen that displays:
- Sending address: Your wallet address (the one being verified).
- Receiving address: The platform’s address provided for the test.
- Deposit amount: The exact amount of crypto you need to send.
Note that this amount does not include network fees. You must cover these fees separately to ensure the correct amount is received.
After making the transaction, click I’ve made the deposit.
4. Provide Address Owner Details
You will need to enter identifying information about the owner of the wallet address, such as:
- Country of residence
- First and last name
This step is mandatory for compliance purposes.
5. Check Verification Status
After submitting the owner details, the status of your verification will determine what happens next:
- If successful, you can proceed with your withdrawal.
- If pending, your withdrawal may be placed on hold until verification is complete.
You can check your verification status at any time on your account’s Asset Overview page.
6. Completion and Next Steps
Once verified, your wallet address will remain approved for six months. This means you won’t need to repeat the verification process for future transactions during this period.
If your verification times out or fails, you can restart the process. Note that network fees from previous attempts are non-refundable.
👉 Explore compliant crypto transaction methods
Frequently Asked Questions
What is the purpose of the Satoshi test?
The Satoshi test helps platforms verify that users control the external wallet addresses they use for withdrawals. This is a security and compliance measure designed to prevent fraud and meet regulatory standards like the Travel Rule.
Are there fees for the Satoshi test?
Yes, users are responsible for the network fees required to send the test transaction. The platform does not charge an additional fee for the verification process itself.
What happens if my Satoshi test verification fails?
If the test fails—for example, if the amount is incorrect or the time limit is exceeded—your deposit may be locked. You can usually unlock it by providing details about the sender, or you can restart the verification process.
How long does the Satoshi test approval last?
Once verified, your wallet address is typically approved for six months. After that, you may need to complete the verification process again for continued use.
Which cryptocurrencies or networks support the Satoshi test?
The test is supported on most major networks, but it is not available on the Bitcoin Lightning Network. Always check your platform’s current list of supported networks.
Can I use digital signature verification instead?
Yes, where available, digital signature verification is recommended as it is faster and does not involve transaction fees. However, it is not supported on all blockchains.
Completing the Satoshi test is a straightforward process that enhances the security and compliance of your crypto transactions. By understanding the requirements and following the steps, you can ensure smooth and uninterrupted withdrawals to your private wallets.