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Exchange sites remove privacy coins in compliance with KYC regulations

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More exchange sites from around the world have removed privacy coins from their lists due to pressing regulatory concerns. The trend of delisting privacy coins came from the concerns of banks and regulating bodies over privacy and KYC regulations. Monero, Zcash and Dash were some of the most notable privacy coins that have been delisted from exchange sites.

This trend began in Asian countries like South Korea and Japan. Korean exchanges have cited the Financial Action Task Force regulations as the reason behind delisting privacy coins. In Japan, removing privacy coins started as early as 2018 after the exchange site Coincheck lost around 523 million NEM coins due to a cyberattack.

One of the first to remove privacy coin markets from their services in 2020 was South Korean exchange site Bitthumb that removed Monero markets in June.

Crypto exchanges based in Australia were pressured by banks to delist privacy coins in August 2020. Swyftx cited external regulatory and banking pressure as the driving force behind the decision. The 2-stage delisting concluded on August 31, 2020 which effectively removed privacy-focused coins and tokens Monero (XMR), Dash (DASH), Zcash (ZEC), and Verge XVG among others.

Colorado-based cryptocurrency exchange site ShapeShift first removed Monero from their list and was quickly followed by Zcash and Dash in November 2020. The decision was done ‘to further derisk the company from a regulatory standpoint,’ according to ShapeShift’s Chief Legal Officer Veronica McGregor.

Meanwhile, Dutch cryptocurrency exchange Litebit announced to its users in an internal email that it will be delisting privacy coin Firo (formerly known as Zcoin) on December 8, 2020. The email revealed that the coin’s privacy aspect was the reason behind the company’s decision. ‘The regulator of crypto companies in the Netherlands has indicated that cryptocurrencies aimed at privacy are too high a risk.’ Zcoin was officially delisted from the exchange site on December 22, 2020.

Bittrex is the latest exchange to follow the trend of removing coins focused on privacy. The Washington-based exchange site announced on January 1 that it will be delisting Monero (XMR), Zcash (ZEC) and Dash. Dash responded in an official tweet saying, ‘Dash’s privacy functionality is no greater than Bitcoin’s.’ Branding Dash as a ‘privacy coin’ is a misnomer according to the company’s official Twitter account.

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