Binance, a major cryptocurrency exchange, has announced plans to delist all privacy tokens in European countries including France, Italy, Poland, and Spain. The move, which will go into effect on June 26th, will affect a total of 12 coins such as Monero (XMR), Zcash (ZEC), and Dash (DASH). Binance cited local regulatory requirements for the move, saying that it is necessary to comply with local laws and regulations regarding the trading of privacy coins. The spokesperson for Binance explained that while the company aims to support as many quality projects as possible, it must follow local regulations to continue to serve as many users as possible.
Privacy-focused cryptocurrencies like Monero and Zcash are designed to obfuscate blockchain transactions and provide users with increased privacy. However, governments around the world have been actively opposing the adoption of privacy-focused cryptocurrencies and crypto privacy tools, citing Anti-Money Laundering (AML) and counter-terrorism financing concerns. This move by Binance follows a similar move by major crypto exchange Huobi, which terminated support for seven privacy coins, including Monero, in September 2022.
In the case of Binance, a spokesperson for the exchange noted that it would no longer be able to offer enhanced anonymity crypto assets (CAE) in several European countries due to local regulatory requirements. The move is an attempt to comply with regulations around privacy-focused cryptocurrencies by governments that believe these tokens could be used for illicit purposes.
The news comes amid global jurisdictions applying major AML regulations by the Financial Action Task Force (FATF), known as the Travel Rule. One of the critical aspects of the Travel Rule is the requirement to pass certain customer data about crypto transactions to regulators. Thus, it is becoming increasingly challenging for cryptocurrency exchanges to allow anonymous transactions.
The decision by Binance, and similarly by Huobi, has sparked controversy among users who see privacy as a fundamental right. The delisting of these coins has been met with criticism from the Monero community, with some expressing concern about the potential impact on the privacy of individuals. Many in the cryptocurrency community view privacy as essential to protecting themselves from cybercriminals and other malicious actors who might use their personal information against them.
However, governments remain wary of the use of cryptocurrency for illicit activities such as money laundering and terrorist financing. In the United States, authorities recently sanctioned the use of major crypto mixer Tornado Cash, which is designed to provide increased privacy to users. Governments around the world are taking steps to ensure that the use of cryptocurrencies is transparent and regulated, which may include prohibiting privacy-focused coins.
In conclusion, the move by Binance to delist all privacy-focused tokens in several European countries might further increase the debate over the role of privacy in the cryptocurrency space. Although governments are taking steps to regulate cryptocurrency and ensure transparency, cryptocurrencies’ anonymity remains an essential feature valued by many users. The issue of privacy in cryptocurrency is likely to remain a contentious one as regulators balance the need to protect against illicit activities while respecting users’ privacy.
