Upbit delisting privacy coins following new regulations

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Following a growing trend in South Korea, Upbit became the latest cryptocurrency exchange service to delist a series of privacy coins. This came in response to new regulatory requirements set by the international body known as the Financial Action Task Force (FATF).

In an official notice provided by the company, they explained that effective September 30, six coins will no longer be included as part of their trading support. This will include Monero (XMR), Dash (DASH), ZCASH (ZEC), Haven (XHV), BitTube (TUBE), and PIVX (PIVX).

Members who currently hold these coins with the exchange are required to withdraw the coin by October 19 of this year.

Within the notice, it was explained that “There are also crypto-assets that can selectively utilize anonymity features among projects that are subject to end of transaction support. For these crypto-assets, Upbit has only supported transparent withdrawal/deposit support.”

The notice continued on by explaining the reasons why the transaction support will no longer be included. The official list included:

• Concerns related to anonymity.
• Ensuring that there is no possibility of money laundering and inflow from external networks.

The government of South Korea has been taking a rather harsh view related to these privacy coins. It seemed inevitable that new regulations would ultimately lead to the end of currency exchanges offering this service, and Upbit is the second this week to delist these coins. OKEx Korea also took this course of action.

It appears that the primary problem related to them is that they have not met the domestic FATF guidelines. Further research is required as to whether they can meet the guidelines, but it does not appear that this research will be conducted soon.

The FATF guidelines have created trading rules governing cryptocurrencies which ask businesses to authenticate the parties involved in any transaction that exceeds $1000. It is expected that by June 2020 that over 200 nations will have implemented these regulations. South Korea has been one of the most active in implementing the guidelines, and this has led to a number of exchanges finding that it would be impossible to offer these coins under the new guidelines.

Compounding the problem is the fact that the value of these privacy coins has been fluctuating and falling of late. A lot of these coins continue to struggle to gain acceptance and traction within South Korea, including both Monero and ZCash. PIVX is also seeing sharp declines, and it is expected that they will see a similar devaluation as that of the other two.