The manner in which the cryptocurrency space has grown, and specialised, in recent times has shone a light on the various, disruptive, uses for the technology and its tokenized subsector. However, this has also shone a light on the parts of cryptocurrencies which have attachments that make them less appealing to regulators.
The history of cryptocurrencies began with Bitcoin and its first primary use case which was a currency of the dark web. This reputation still stains the coin as many feel that it can be used as a tool for illicit goods and services, money laundering, and even terrorist funding. While Bitcoin tries to fight this reputation, there are even more pressing concerns.
There exists a set of cryptocurrencies which predicate themselves on privacy and anonymity, and while there is nothing wrong with this as people value their privacy, these coins are better suited for more illicit uses. Monero, zCash, and others fall into this category.
Recently, there has been a spate of delisting and distancing from these types of coins, with the latest coming from Huobi Korea. The reason stated here is because of low trading volume, but also its ‘anonymity functions’. However, there are also, unmentioned, issues surrounding a sexual exploitation case that used XMR to complete anonymous transactions.
Monero and zCash have faced a number of delistings in recent times as regulators are concerned about their uses, but does this mean there is no room for them in modern cryptocurrency spheres?
Finding a use
Recently, it was announced by HTC and its blockchain phone, EXODUS 1, that the phone would be able to mine cryptocurrency on the go — a first for the space. The chosen currency, however, is Monero, which is under scrutiny, but according to Phil Chen, Decentralized Chief Officer at HTC, the coin has its uses in this sense because of its mining algorithm.
“Any issues with Monero’s privacy does not impact on its technical ability to be mined in this first important step and breakthrough,” he told Forbes
“The privacy and fungible aspect of Monero is mostly irrelevant to the AML and KYC of banks. In other words, banks can still properly perform AML and KYC with a privacy coin like Monero. Asking the customer, for example, where your Monero came from is an off-chain problem. Further, I’d argue that the fungibility aspect of Monero makes it even more antifragile as a medium of exchange as opposed to a piece of property with clear provenance,” he added.