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Binance announces withdrawal of support for anonymous Litecoin transactions

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Binance has announced that it will not support Litecoin transactions made using the MimbeWimble Extension Blocks feature. Litecoin’s latest feature allows users to make confidential Litecoin transactions without revealing any information about the transaction or the sender’s address.

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The cryptocurrency exchange has stated that any Litecoin transactions made through the MimeWimble extension block will neither be received nor returned. He said this was due to his inability to verify the sender’s address and a warning about possible loss of funds by transactional users.

Binance under threat

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Binance recently came under scrutiny by the regulator after a Reuters report claimed that the world’s largest cryptocurrency exchange facilitated illegal transactions worth at least $2.35 billion.

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Reuters claims in a report that Binance was used as a “channel” by illicit entities to clear its cryptocurrency of hacks, investment fraud and drug sales between 2017 and 2021.

report also mentioned that the North Korean group Lazarus laundered some of the proceeds from the 2020 Eterbase hack through the exchange.

While a Binance official called the report “regrettably misinformed,” it exacerbates the problems of the crypto exchange giant, which is already under several investigations.

In February, the US Securities and Exchange Commission launched an investigation into Binance trading affiliates associated with its CEO, Changpeng Zhao. The cryptocurrency exchange has also been the subject of investigations by the US Commodity Futures Trading Commission, the US Department of Justice, and the US Internal Revenue Service.

Last year, the Financial Conduct Authority ordered Binance to cease operations in the United Kingdom. A similar closure occurred in Canada, which was due to Ontario becoming a “restricted jurisdiction”.

Litecoin Faces Rising Concerns

The Litecoin MimbleWimble Extension Block feature was activated on May 19, 2022 as part of a long-awaited update. It was conceived as part of the Litecoin Improvement Proposal to increase online anonymity. However, since their launch, several exchanges have raised concerns about money laundering.

Binance’s announcement comes days after South Korean exchanges Crypto, Bithumb, and Upbit announced they were delisting the coin.

Cryptocurrency exchanges have raised concerns about the recent changes made to Litecoin, which provide more privacy when conducting transactions. As stated in their notices, users with increased privacy are against the South Korean Anti-Money Rules (AML).

Crypto trading platform Gate.io also announced a similar discontinuation of support for Litecoin transactions made using the MimeWimble extension block, citing that anonymous transactions are not allowed on the platform.





Credit : cryptoslate.com

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