Major privacy coins are at great risk of getting delisted from more exchanges, which would take a toll on their declining liquidity, Bloomberg reports. This niche of the crypto market has been under a lot of pressure after the Financial Action Task Force (FATF) announced its “travel rule.”
A life-or-death struggle
Under the FATF guidelines, cryptocurrency customers are able to share data about their customers if they transfer more than $1,000, making it easier for law enforcement to track suspicious transactions. Not complying with this rule could result in a death sentence for crypto businesses.
Dealing with privacy-oriented coins, which prioritize the complete anonymity of their users, has proven to be some sort of a puzzle. Hence, multiple exchanges — from Coinbase to OKEx — have stepped up to delist this subset of cryptocurrencies from their trading platforms.
It’s certainly seen as creating a huge hurdle to the existence of privacy coins,” said Chainalysis exec Jesse Spiro.
As reported by U.Today, Coinbase’s new banking partner didn’t give it carte blanche, forcing it to delist ZCash.
Privacy proponents beg to differ
Developers behind the leading privacy coins insist that privacy coins hey can still be in line with the FAFT requirements despite their anonymous nature.
For instance, Dash, the cryptocurrency that initially got called “DarkCoin” because of its wide use in dark web markets, doesn’t differ from Bitcoin from a legal standpoint, according to Dash Core Group CEO Ryan Taylor.
Dash is identical to Bitcoin and is 100% capable of meeting the requirements.”
The proponents of Monero and Zcash also believe that these coins will pass the test.