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Major CEXs persist in delisting anonymous coins: the end for the privacy era?

Amid the news that Binance would delist Monero, should the crypto community brace for the decline of the era of anonymous tokens, or will alternative solutions emerge? In the world of cryptocurrency, transactions are logged in a public ledger, meaning that one can trace a person’s identity with some effort. However, privacy-focused coins aim to change that. Anonymous coins are digital currencies designed to uphold secrecy by obfuscating the movement of funds within their networks. The most popular anonymous tokens are: Monero (XMR): Monero uses ring signatures to blend private and public keys. Zcash (ZEC): The coin employs the zk-SNARK protocol, enabling users to prove information accuracy without revealing details. Komodo (KMD): A Zcash fork that facilitates public and anonymous transactions using zero-knowledge proof and a delayed proof-of-work (dPoW) protocol. Dash (DASH): Divides coins from multiple senders into elements, thoroughly mixing them. Verge (XVG): Utilizes Tor software to conceal transfer locations and user IP addresses A few years ago, many investors, traders, and users of crypto assets held a negative view of anonymous coins. Despite this sentiment, a dedicated group of admirers still see the potential of such technology. However, the sheer volume of enthusiasts may not reach the levels seen in the past. What is wrong with anonymous tokens? The primary aim of anonymous cryptocurrencies is to safeguard the privacy of financial transactions. However, their proliferation has coincided with a notable rise in fraudulent attacks and financial crimes involving cryptocurrencies, with attackers leveraging these tokens to obscure the movement of illicit funds. In response, governments worldwide have pivoted towards stricter cryptocurrency regulations, targeting what are known as confidential coins. Certain crypto platforms are opting to discontinue support for these privacy-focused tokens. By refraining from an outright ban on digital currencies, governments aim to address two primary concerns: safeguarding investors and traders and curbing criminal activities facilitated by cryptocurrencies. Sanctions against Tornado Cash On Aug. 8, 2022, the U.S. Department of the Treasury published an update to the Sanctions List (SDN), adding the Tornado Cash cryptocurrency protocol and its associated digital wallet addresses. The decision was prompted by findings indicating the platform’s use in laundering illicitly obtained funds, where crypto-assets were acquired using proceeds from illegal activities. OFAC also claims that Tornado Cash has become a key tool used by criminals to launder cryptocurrency funds stolen from decentralized exchanges and games such as Axie Infinity. Sanctions against Tornado Cash represent a significant regulatory action not only targeting crypto mixers but also highlighting concerns about privacy-enhanced coins in general. The expansion of sanctions beyond individual addresses to encompass project codes sets a potentially precedent-setting action with broad implications, particularly for U.S. citizens. These developments have sparked concerns within the cryptocurrency community about the potential banning of other anonymous cryptocurrencies. For instance, the Monero community acknowledges a possible.

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