Hard Times Continue For Privacy Coins

A few days ago, LiteBit – a smaller cryptocurrency exchange based in the Netherlands – announced it will be delisting Firo (formerly known as zcoin).

This is only the latest in a string of delistings for privacy coins, with Bithumb, Shapeshift, and other exchanges dropping currencies like Monero within recent memory.

Regulatory Pressure

The delisting of privacy coins is generally a result of smaller exchanges not having the legal and financial resources to explain their risk mitigation strategy to banks – which unfortunately tends to give the idea that privacy coins are simply not compliant with AML standards, according to Firo project steward Reuben Yap.

Japan and South Korea are leading the charge when it comes to the delisting of privacy coins – and Australian exchanges have also been undergoing significant pressure from banks, forcing many exchanges to delist, even if the people behind the exchange may not agree with the policy.

 Alex Harper – the CEO of Swyftx – criticized the pressure exerted by banks when it comes to privacy coins.

“While we do not fully align with the hard-line response of banning all privacy-related coins, we will continue to work proactively with our partners and regulators to reduce criminal activity and advance the crypto industry in the most effective ways.”

Even within the European Union, where privacy is a much larger concern – as evidenced by the enactment of the GDPR, heavy restraints set on big tech like Google, Apple and Facebook and more – certain countries, such as France and the Netherlands – have also been recommending a ban on privacy coins.

However, Reuben Yap remains positive about the future of privacy coins.

“Privacy coins will continue to face opposition and challenges along the way, which will heat up as cryptocurrencies start becoming more mainstream. However, just as VPNs, Tor, HTTPS, and end-to-end encrypted messaging are now considered standard protection tools, privacy technology in cryptocurrencies will be considered commonplace, too.”

For now, the conflict over privacy coins is still somewhat limited to smaller exchanges – but due to the nature of privacy coins and their fans, the demise of privacy coins seems unlikely.