A Satoshi Test is how an exchange checks that a self-hosted wallet is really yours: you send a small, exactly specified amount of crypto from that wallet, and the exchange watches the blockchain for it. Only the holder of the private keys can produce that precise transaction, so it counts as proof of control. It is a routine compliance request under EU anti-money-laundering rules, not an accusation.
If you have just hit this wall — a withdrawal to your hardware wallet paused, a form asking you to “verify ownership of the destination address” — this guide explains where the request comes from, how the test works, what the alternatives are, and what happens if you fail or ignore it.
Why Exchanges Now Ask You to Prove Wallet Ownership
The trigger is the EU Transfer of Funds Regulation, Regulation (EU) 2023/1113 — the European implementation of the “travel rule”. It has applied to crypto transfers since 30 December 2024, and it changed what exchanges (legally, crypto-asset service providers, or CASPs) must do whenever coins move between them and a wallet you hold yourself.
Two obligations matter to you as a user:
- For any transfer between your exchange account and a self-hosted address, the exchange must collect information about who is behind that address.
- If a transfer exceeding EUR 1,000 is sent to or received from a self-hosted address that belongs to you, their own customer, the exchange must verify that you actually own or control that address.
The [European Banking Authority’s Travel Rule Guidelines](https://www.eba.europa.eu/publications-and-media/press-releases/eba-issues-travel-rule-guidance-tackle-money-laundering-and-terrorist-financing-transfers-funds-and), published in July 2024 and applicable from 30 December 2024, spell out acceptable ways to run that verification. A micro-transfer — the Satoshi Test — is one of them; cryptographic signatures are another. Major platforms describe the same procedures in their own help centers, for example Crypto.com’s EU Travel Rule FAQ.
In short: the request is not aimed at you personally. Exchanges send it because the law requires them to. For the wider background on how the travel rule works, see our FATF Travel Rule guide.
What a Satoshi Test Actually Is
The name comes from the satoshi, the smallest unit of bitcoin, because early versions used amounts of a few satoshis. The mechanics are the same on any chain:
- The exchange gives you an exact amount — deliberately odd, something like 0.00004217 BTC — plus an address and usually a time window.
- You send exactly that amount from the self-hosted wallet being verified.
- The exchange watches the chain. When a transaction with the right amount arrives from the right wallet in time, verification is complete.
- The result goes into your compliance file and the exchange can continue processing the paused transfer.
The logic is simple: a blockchain transaction can only be authored by whoever holds the private keys, and the randomly chosen amount makes a coincidental match practically impossible. It is proof of control, produced on-chain, checkable by anyone.
Before you send, watch four things:
- Send from the wallet named in the request — not from another exchange account or a friend’s wallet. Sending from a custodial account defeats the purpose and typically fails the check.
- Match the amount exactly. “Roughly right” fails automated matching.
- Budget for the network fee on top of the test amount.
- Respect the time window. An expired test usually just needs to be restarted.
How the Satoshi Test Compares With the Alternatives
Depending on the platform and the chain, you may be offered one of several methods:
- Satoshi Test (micro-transfer). Works on every chain because it is just a normal transaction, requires no special wallet features, and leaves on-chain evidence. Downsides: a network fee, a wait of one or a few blocks, and it fails on typos.
- Message signing. Your wallet signs a text challenge with its private key and the exchange verifies the signature. Free, instant, no transaction needed. But not every wallet exposes message signing, and support varies by chain, so it is not always available.
- WalletConnect session. You connect the wallet and approve a session or signature. Instant and free, but limited to WalletConnect-compatible wallets, which mostly means the Ethereum ecosystem.
- Screenshots and self-declaration. Some counterparties accept a screenshot of your wallet or a signed statement as a fallback. This is weak evidence: a screenshot proves you can view an address, not that you hold its keys. Anyone can screenshot a block explorer or a watch-only wallet, which is why screenshots tend to invite follow-up questions rather than close the case.
If your wallet supports signing, that is usually the fastest route. If it does not — common with some hardware wallets and non-EVM chains — the Satoshi Test is the universal fallback.
What Happens if You Fail or Ignore the Request
Failing on a technicality — wrong amount, missed window, wrong source wallet — is normally recoverable. Restart the test and follow the instructions exactly.
Ignoring the request is different. The regulation requires exchanges to decide what to do with transfers whose verification is incomplete, and their options include delaying, rejecting or returning them. Policies vary by platform, but in practice you can expect some combination of:
- the withdrawal or deposit staying on hold, or an incoming transfer being returned
- further questions about the wallet and the source of the funds
- limits on the account while the case stays open
None of this means you are suspected of anything. An unverified self-hosted address is simply something the exchange cannot process above the threshold without breaching its own obligations. The pragmatic move is to complete the verification once, properly, and keep evidence that you did.
Verify Once, Keep the Proof
The tiresome part is repetition: every exchange, OTC desk or bank runs its own process, and the proof you gave one counterparty rarely travels to the next.
CryptoPass, a mobile compliance app for iOS and Android built by Cibex AG in Liechtenstein, runs the same verification independently of any exchange. You prove control of your wallet either with a refundable Satoshi Test — a unique micro-amount sent to a one-time address, confirmed on-chain within one to three blocks, available on all supported chains — or via WalletConnect for Ethereum and compatible chains, which is instant and needs no transaction. Supported assets are BTC, ETH, SOL, TRX, GRAM (formerly TON) and USDT.
The result is a KYW (Know Your Wallet) certificate: a detailed PDF with a blockchain-verified hash and a 0–100 score based on transaction history, counterparty risk, sanctions exposure and the ownership verification itself, shareable by QR code or link. It does not replace a check an exchange insists on running itself, and each institution decides what it accepts — but it gives you the documentation compliance teams typically request, prepared before anyone asks. An independent legal opinion from July 2023 by Dr. Stephan Ochsner, former CEO of the Liechtenstein Financial Market Authority, found that the CryptoPass process aligns with state-of-the-art requirements for proving wallet ownership and supporting source-of-funds clarification under FATF, EU and Liechtenstein standards.
The basic check is free, with no card and no KYC to start — get the app. A full KYW certificate costs from EUR 10 per wallet, with no subscription; see pricing.
FAQ
Is a Satoshi Test request legitimate, or could it be a scam?
Legitimate tests ask you to send a tiny amount from your own wallet to a deposit address shown inside your logged-in exchange account. They never ask for your seed phrase, private keys or remote access. If a request arrives by email or chat and points to an unfamiliar address, confirm it inside the official app first.
How much does a Satoshi Test cost?
The test amount itself is tiny, typically a fraction of a euro, and when you send it to your own deposit address at an exchange it usually stays in your balance. The real cost is the network fee, which depends on the chain. CryptoPass refunds the micro-amount used in its own test.
Why is a screenshot not enough to prove wallet ownership?
A screenshot shows that you can see an address, not that you control its keys. Anyone can capture a block explorer page or a watch-only wallet. Counterparties that still accept screenshots treat them as weak evidence and tend to follow up with more questions, so a signature or a Satoshi Test settles the matter faster.
Do I have to repeat verification for every exchange?
Each counterparty runs its own checks, so without portable documentation you may repeat the process platform by platform. A KYW certificate records a completed ownership proof and risk check in one shareable document. Each institution still decides what it accepts, but you start the conversation with the paperwork already in hand.
This article is general information, not legal or tax advice.
