Two major South Korean cryptocurrency exchanges, UpBit and Bithumb, have announced that they intend to delist Litecoin. LTC is one of the oldest cryptocurrencies in the cryptocurrency market.
Exchanges want to delist Litecoin after update
According to the exchanges, the possible deletion comes after the developers enabled a privacy feature on Litecoin. This is MimbleWimble, which was added through the MimbleWimble Extension Blocks (MWEB).
Upbit revealed that the listing termination would occur because LTC, with the protocol, no longer provides transaction history. This goes against South Korea’s Law on the Reporting and Use of Specific Financial Transaction Information.
“Transaction support for digital assets with technology that makes streaming records indistinguishable from the past is prohibited in South Korea,” the exchange stated.
Cryptocurrency exchanges in the country are required to implement KYC and AML measures. In other words, combating money laundering and “Know Your Customer”. However, MWEB on Litecoin makes it impossible to identify the origin of the funds. Therefore, the asset may be unavailable on the country’s exchanges.
Similarly, Bithumb sent a similar notification. The exchange issued a notice citing the MWEB implementation. In addition, it explained how the privacy protocol could threaten existing Korean laws. After all, it can facilitate the concealment of financial transactions.
However, no official delisting announcement has been made so far. Exchanges typically only delete assets after issuing these warnings.
As Chayanika Deka highlighted, it is important to understand that the new privacy update is opt-in in nature. That is, it makes cryptocurrency quite different from existing privacy coins such as Monero.
The main distinction between Litecoin and privacy coins is the existence of a separate chain for private transactions. As Litecoin Foundation community manager Ilir Gashi explained, the move should keep the crypto asset away from unwarranted scrutiny from regulators.
About the update
Litecoin activated the MWEB update at block height 2257920. This was after the network reached the network consensus threshold of 75%.
The main objective of the protocol is to improve the viability of LTC as a fungible currency. In this way, the project starts to focus on reducing fees, increasing privacy and scalability.
They first proposed the idea of privacy opt-ins two years ago. In charge of leading its development is Grin++ developer David Burkett.