On June 8, 2022, South Korean digital currency exchange Upbit announced that it would cease supporting Litecoin transactions.
The move comes after the activation of the privacy feature MimbleWimble (MWEB) and brings the total number of digital currency exchanges that have delisted Litecoin to five, including major exchanges like Upbit and Bithumb.
Five major South Korean #crypto exchanges – Upbit, Bithumb, Coinone, Korbit and Gopax announced to delist #Litecoin (LTC)https://t.co/p1SdMr1Gu5
— Gwei Research(fomerly 8BTCnews) (@btcinchina) June 8, 2022
Why are Upbit, Bithumb, and others delisting Litecoin?
In its announcement, Upbit cited the Act on Reporting and Use of Specific Financial Transaction Information as its reason for delisting Litecoin. The Act prohibits anonymous transactions. The exchange reached out to the Litecoin Foundation for more information after expressing concerns about the upgrade, and subsequently said the following:
We decided to terminate the transaction support for Litecoin (LTC), as it was determined that the optional function that does not expose transaction information included in this network upgrade corresponds to anonymous transmission technology under the Specific Financial Information Act.
The exchange will end LTC transaction support on June 20. It will mean the cessation of support for things like airdrops, wallet upgrades, and hard forks associated with Litecoin and the automatic cancelation of all buy and sell orders on its trading platform.
What is MimbleWimble?
MimbleWimble is Litecoin’s long-awaited privacy upgrade. It’s named after a well-known tongue-tying spell in the Harry Potter story series. In it, the spell ties victims’ tongues and stops them from revealing specific information. Ultimately, the goal of MimbleWimble is to make transaction information completely anonymous.
Just a day before Upbit’s announcement, Litecoin creator Charlie Lee talked it up on social media, speaking of how it would enhance Litecoin’s scalability and make it more fungible.
This issue has been resolved in v0.21.2.1. If your wallet was affected, you can use "rescanblockchain 2265984" after upgrading to recover any missing coins. https://t.co/ujM2jhJKfd
— David Burkett Ⓜ️🕸 (@DavidBurkett38) June 7, 2022
More clueless nonsense from anarchist utopians
Whether Lee and others who supported MimbleWimble were aware of the potential for delistings is unclear. However, they may have some explaining to do if exchanges in other large markets like the European Union delist Litecoin to avoid running afoul of similar regulations.
Yet again, we have a clear example of how the naive idealism of people like Lee conflicts with the reality of the law and the needs of regulated businesses. While Lee and his acolytes are focused on building untraceable electronic cash systems that would allow terrorists, drug kingpins, and worse to operate with no fear of getting caught, serious businesses like exchanges are focused on surviving financially and making a profit within increasingly regulated markets.
Litecoin holders shouldn’t be surprised to see similar delistings by other regulated exchanges. As major economic and political powers like the European Union and United States get to grips with how to regulate digital currencies and blockchain technology, with key players like the SEC’s Gary Gensler vowing to end the ‘Wild West’ era of the industry, it will become increasingly clear that currencies like Litecoin and Monero have no future other than to act as underground railroads for cybercriminals.
Meanwhile, blockchains committed to working within the law, such as Bitcoin SV, are seeing true enterprise adoption and interest from major tech players like the IPv6 Forum’s Founder Latif Ladid. Serious developers and investors in the industry should ask themselves which blockchains and digital currencies are most likely to survive and thrive in an increasingly regulated world? If the actions of Upbit, Bithumb, and others are anything to go by, Litecoin won’t be on that list.
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