What is 'Know Your Customer' (KYC) in the crypto industry?

In the ever-evolving landscape of cryptocurrency and finance, one crucial aspect that often raises questions is the concept of 'Know Your Customer' (KYC). Could you elaborate on what KYC entails in the crypto industry? How does it differ from traditional financial institutions' KYC practices? What are the key reasons behind implementing KYC in the crypto space? Does it ensure customer safety, compliance, or both? Understanding KYC's implications is crucial for anyone venturing into the crypto world, so I'd appreciate a thorough yet concise explanation of this essential process.