The Palau ID KYC on Bybit is over: the Republic of Palau recently introduced restrictions on the program for US citizens, along with impossibility of using the Palau Digital Residency as proof of address for KYC on crypto exchanges like Bybit.

These changes represent a halt to the primary use case of the RNS.ID program: legal identity verification for KYC (know your customer) and AML processes.

Many of those who were using the Palau Digital Residency program as a tool to protect their privacy, for example when opening accounts on crypto exchanges such as Bybit, are now in search of alternatives to not lose to these services while not sharing your original passport details.

If you're looking for alternative identity solutions to invest in Bitcoin, Ethereum, or engage in crypto trading and blockchain projects, here are the three best Palau Digital Residency and Physical ID card alternatives:

List of Palau Digital Residency ID Alternatives:

These are the best Palau ID KYC alternatives for 2025:

  1. Investing in Citizenship and getting a Second Passport
  2. Getting another e-Residency in a place like Estonia

Core Benefits:

  • A passport is the utmost legal identity verification document. This means, you will be able to use your second passport to do KYC/AML processes worldwide, as it will have the same validity as your main passport.
  • Risk management and portfolio diversification. The same way you don't putt all your eggs in one basket, you shouldn't have only one passport. This poses significant risks upon regulatory changes. Having multiple citizenships will not only help you to selectively reveal yourself to the world but will also give you a hedge against political instability.
  • Lifelong rights as a citizen. Citizenship is the highest legal bound between an individual and a country. This means that you will forever have citizen rights in that country, such as living unrestrictedly or traveling visa-free with the country's passport. This is considerably superior to, for example, being a digital resident of Palau.

Cost:

The fastest, easiet way to acquire a second passport is through capital-based citizenship. Numerous citizenship by investment programs allow investors and their families to acquire direct citizenship in exchange of an economic contribution the host country, with minimum investments ranging from $130,000 USD to +$1m USD.

Features Vanuatu Nauru Caribbean Programs
Minimum Investment $130,000 Single: $105,000 (contribution)
Family (2-4): $110,000
Family (5+): $115,000 		$200,000 USD minimum investment
Additional Fees Varies Application: $25,000-$30,000
Due diligence: $10,000 (single) or $7,500 per person (16+)
Passport: $500 per person 		Varies by country and family size
Processing Time 2-3 months 3-6 months 3-6 months (average)
Investment Options - Development Fund Contribution
- Real estate not available 		Direct treasury contribution only - Government Fund Contribution
- Real Estate Investment
- Business Investment (select countries)
Restricted Nationalities None Afghanistan, Belarus, Iran, Myanmar, North Korea, Russia, Sudan, and Yemen Varies by country
Family Inclusion Spouse and dependent children under 25 - Main applicant + family members
- Additional siblings: $15,000 each 		Spouse, children under 25, dependent parents over 65
Due Diligence Timeline 4-6 weeks Part of 3-6 month process 8-12 weeks
Tax Implications Tax resident only if living in Vanuatu Territorial tax system Varies by country

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2/ Estonia e-Residency: Beware. Advertised as a cheap alternative to Palau ID but generally not accepted for KYC on Bybit.

Strengths:

  • First e-residency program in the world.
  • Allows you to incorporate companies in the Estonia and access the EU market.
  • Can be a good starting point for beginners looking to diversify their identity footprint.

Weaknesses:

  • Generally valid only to operate as a business, not as an individual as it's generally not be accepted for KYC/AML processes as a no-photo ID.
  • No physical residency rights.
  • Like its Palauan counterpart, this is also a digital identity with a government-issued ID, closer to a driver's license than a fully-blown identity such as citizenship and a passport. This comes with limitations in terms of international recognition and validation.
  • The processes has become increasingly complex and more invasive as more digital nomads started using it.

Cost:

Estonian e-Residency, a digital identity program that allows non-Estonians to access various online services, currently costs €100 if picked up in Estonia or €120 if collected at an Estonian embassy.

However, starting January 1, 2025, the fee will increase to €150 for both application and renewal. Additional costs to consider include company registration fees (€265 state fee plus €25 + VAT service fee), legal address and contact person services (averaging €200-400 annually), and accounting services (starting from €50 monthly).

Learn More About Estonia e-Residency: https://www.e-resident.gov.ee/

Learn More About Palauan e-Residency: https://rns.id

Other digital residency options:

Country International Recognition KYC Use Cases Associated Costs (USD)
Estonia Widely recognized, especially within the EU. First country to offer e-Residency globally. Accepted by major international banks and financial institutions. Remote company incorporation, digital banking access, cryptocurrency exchange verification, digital signing of documents, tax declarations, and accessing government e-services 120
Lithuania Recognized within the EU. Growing acceptance in international business communities, particularly for fintech operations. Opening EU bank accounts, fintech platform verification, accessing Lithuanian business registry, remote company management, digital contract signing 100
Azerbaijan Regional recognition, primarily within CIS countries. Limited international acceptance compared to EU programs. Local business registration, digital signatures for government services, tax filing, customs declarations, public procurement procedures 50

What's the Best Alternative to the Palau ID for KYC?

Features Citizenship E-residency
Multi-jurisdiction Yes No
Digital Identity Yes Yes
Physical Identity Yes No
Cryptocurrency Yes Sometimes
KYC/AML validity Global No
Global Recognition Full No

Summary for ID KYC on Bybit

While Palau was one of the pioneers for digital ID (DID) verification, sovereign individuals in 2025 need more comprehensive solutions to work with crypto exchanges like Bybit.

If you're looking to get a solid identity solution through a second passport and citizenship, CitizenX offers the most private and secure platform for investing in citizenship.

Ready to diversify your passport portfolio? Start your application with CitizenX today.