Exchanges Are Removing Support for Privacy Coins: Why Are Privacy Coins Being Delisted?

Exchanges around the globe are already starting to delist cryptocurrencies that have privacy features, known as privacy coins, as regulatory pressure from government organizations is growing. According to exchanges that are announcing support removal for privacy coins such as Zcash (ZCH) and Monero (XMR), the announced delisting of privacy coins is strictly related to the FATF rule (Financial Action Task Force).

OKEX Korea Exchange, Coinbase UK and Upbit Already Announcing Delisting of Privacy Coins

According to FATF (Financial Action Task Force) and the “travel rule”, exchanges dealing with cryptocurrencies are recommended to enable easy collection of users’ data that would preferably include personal information such as names and addresses, which is why privacy coins are being removed.

Privacy coins are designed to enable anonymity to users and consumers, which is why these types of cryptocurrencies are not compliant with FATF regulations regarding travel rule. With privacy coins, users’ information cannot be collected, which led to the decision of OKEX Korea to delist privacy coins and avoid troubles with regulators. OKEX is not the only exchange removing support for privacy coins, as Coinbase UK decided to delist Zcash already back in August 2019 due to the same case, which is the inability to collect users’ data.

The main reason why regulators are opposing the utilization of privacy coins is concern for money laundering, while working on improving AML framework. In the meanwhile, Upbit exchange also announced removing support for privacy coins and delisting Dash, Zcash, Monero, and more privacy coins, which should be finalized and official by the end of September 2019.

On the other hand, Tokens.net is providing strong support for privacy coins, believing that cryptocurrency consumers have the right to trade anonymously and under utmost privacy.

Tokens.net announced their support for privacy coins on Twitter, with the following statement:

Bakkt Launches Bitcoin Futures: What is Bakkt and Why You Should Care

Bakkt is a Bitcoin warehouse and a facilitator of Bitcoin futures contract. After more than a year of planning, announcing and anticipating the arrival of Bitcoin futures as announced by Bakkt services, Bitcoin warehouse is finally launching futures as promised. Bakkt started with Bitcoin futures trading officially on September 23rd, 2019, offering a unique opportunity to investors to join the cryptocurrency market by taking positions in futures that are appropriately regulated to match the governments' requirements.

Bakkt Officially Launches Bitcoin Futures: Bitcoin Futures Available for Trading on Bakkt

Future contracts were much anticipated as Bakkt was preparing to launch Bitcoin futures, which is probably due to the case that these types of crypto-related trades carry lowered risks of losing investments because of high volatility and frequent fluctuations in the market of digital assets. Starting from September 23rd, 2019, Bakkt opened Bitcoin futures trading, where investors may create hedge positions on Bitcoin and invest in physically settled contracts for Bitcoin futures that are supported by Bakkt warehouse.

Future contracts were much anticipated as Bakkt was preparing to launch Bitcoin futures, which is probably due to the case that these types of crypto-related trades carry lowered risks of losing investments because of high volatility and frequent fluctuations in the market of digital assets. Starting from September 23rd, 2019, Bakkt opened Bitcoin futures trading, where investors may create hedge positions on Bitcoin and invest in physically settled contracts for Bitcoin futures that are supported by Bakkt warehouse.

The minimum amount per Bitcoin contract is 2.50 USD with Block Trades being executable at 0.01 USD per one Bitcoin contract. Investors are able to trade with daily Bitcoin futures contracts which have a one-day expiration, which should allow institutional investors to trade with Bitcoin in a manner more familiar than the chaotic market of digital assets where prices may radically and suddenly go up and down. Investors are also able to make their positions in Bitcoin futures in the long run and invest in 30-day contracts, although one-day contracts represent an effective way of turning a profit and trading on a daily basis.

Bakkt representatives expect a major turnout from institutional investors, considering that products like contract futures should be gradually gaining in popularity with the maturing of the cryptocurrency market. Although the prominent service is hoping to have an increased activity in terms of attracting institutional investors, Bakkt representatives don’t expect a major increase in demand to happen instantly.

German Government to Prevent Stablecoins from Jeopardizing State Sovereignty

Fearing that stablecoins backed by fiat currencies to reflect a solid and viable monetary value, and embrace stability in the market, may place state sovereignty in jeopardy, German government decided to adopt a blockchain strategy that will allow the government to prevent stablecoins from becoming alternative currencies. The solution arrives ahead of the upcoming Facebook’s stablecoin that should come out by 2020, backed by major fiat currencies which should include EUR and USD.Angela Merkel’s cabinet passed the blockchain strategy on September 18th, 2019.

Germany Won’t Allow the Issuance of Alt Currencies to be Conducted by Private Sectors and Companies

Germany is definitely interested in blockchain technology and the overall participation in developing this foundational technological novelty, as the government wishes to keep the state among the top technological centers in Europe and globally. However, as far as cryptocurrency issuance goes, Germany is not thrilled to welcome this innovation, especially referring to the upcoming Libra coin, Facebook’s up and coming stablecoin designed to be backed by fiat currency.

The biggest concern that the government has is that the sovereignty of Germany may be jeopardized by allowing Facebook’s Libra to become an alternative choice for consumers. Issuing of national currency is one of the signs of sovereignty, and Germany intends on keeping that right tied inclusively to the government body - currency issuance won’t be taken over by private companies, at least not in Germany and France, which agreed to ally in order to prevent stablecoins from becoming alternative currencies in Europe.

Germany and France Agreed on the Matter of Banning Libra Stablecoin

Facebook’s cryptocurrency department has been preparing to launch their first cryptocurrency, Libra stablecoin, for over a year now as the company behind the famous social media network has been gathering blockchain specialists and resources for the project. The US government has already stated their concerns around the stablecoin, while Germany and France are joining the rally with the goal to ban Facebook’s Libra stablecoin. Germany and France believe that Libra and similar digital assets known as stablecoins could jeopardize the sovereignty of European countries that use EUR as their official currency.

Facebook’s Libra Stablecoin is Not Welcome in Germany and France

Germany already passed a blockchain solution that should ban Facebook’s Libra and similar stablecoins and digital assets from becoming alternative currencies opposing to national fiat currency. Germany and France believe that the right to issue national currency should be strictly reserved for government bodies and that private companies shouldn’t have any takes in this sector.

Facebook announced that Libra stablecoin should be out and about already in 2020, backed with some of the major fiat currencies in the world, which includes EUR and USD. Germany is already making alliances with European countries to seize this matter and prevent Libra from being a part of European consumer economy, that way creating a stable and secure soil for their national currency.

Given the fact that Facebook has more than two billion users on the social media platform, in case that even a part of this giant user base agrees to use Libra, investing.

Bitcoin Lightning Passes the First Official Security Test

Although the first cryptocurrency ever to be launched, Bitcoin is far from being the fastest crypto platform with the ability to process around 10 transactions in one second. Bitcoin carries a great potential in its function and mechanism, along the way creating an entire ecosystem of cryptocurrencies based on the foundational technology that blockchain represents, while many enthusiasts believe that BTC could one day become an alternative method of payment in a mainstream fashion. That means that BTC would have to adopt a scalability solution in order to support great transaction volumes.

Lightning Network was created as an extension to Bitcoin blockchain, where transactions are being recorded within Bitcoin ecosystem but off-chain in order to support prompt payments and transactions, recently having the first security test.

Formal Verification of Bitcoin Lightning Network Completed

Aggelos Kiayias and Orfeas Litos from The University of Edinburgh published complete documentation to the first formal verification of Lightning network in form of a security test. The pair of researchers, knowing that Lightning network is securing around 8 million dollars without a formal verification, published a research paper dubbed “A Composable Security Treatment of the Lightning Network”.

The type of research that the pair of researchers have conducted on the Lightning network, also known as formal verification or security test, is said to be a quite extensive and expensive venture, which is probably why it hasn’t been done before. The goal of the research was to test the security code of the network where the team of two could conclude that Lightning network has a solid and strong security, deeming the test as successful.

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Author: Tokens.net Team
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