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Top 5 Korean exchanges delist Litecoin, labeling it a ‘dark coin’ after MWEB upgrade

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According to a local news outlet, all five of Korea’s top exchanges announced the delisting of Litecoin (LTC) at the same time on June 8. News 1.

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Korean exchanges Upbit and Bithumb issued warnings regarding Litecoin following the MWEB update, as Cryptooshala reported last month.

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The warnings addressed concerns about violating money laundering regulations and Know Your Customer (KYC) requirements.

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However, fast forward to the present and both exchanges have taken steps to delist. They are joined by Coinone, Korbit and Gopax.

What is MVEB?

The Litecoin MWEB privacy update was launched on May 19 after a lengthy development phase.

MWEB added several features and benefits, including greater scalability through more compact data organization. But chief among them was the optional element of confidentiality.

By obfuscating block transactions, the details of the transactions that make up the block become unidentifiable. In short, individual inputs are not easily mapped to outputs, limiting readable transaction information to only the sender and receiver.

Litecoin founder Charlie Lee described this as the key to making LTC fungible and therefore complete in terms of having all the qualities of sound money. Lee lists durability, mobility, divisibility, rarity, versatility, and fungibility as qualities of sound money.

Litecoin delisting

After the MWEB update, the Korean press called Litecoin a “dark coin”, fearing that its “anonymous transfer” violated the country’s specific rules. Financial Information Law.

News 1 informed that in response, the top five Korean exchanges, Upbit, Bithumb, Coinone, Korbit, and Gopax, simultaneously delisted Litecoin.

“The five major domestic cryptocurrency exchanges (Upbit, Bithumb, Coinone, Korbit and Gopax) that operate on the KRW market have announced that they will immediately delist Litecoin.”

The article states that the Special Financial Information Act does not allow “dark coins” that obscure transfer records. Notice issued bitumb accurately reflects this comment.

“Bithumb decides to stop supporting transactions for virtual assets in accordance with the revised Law on the Reporting and Use of Specific Financial Transaction Information in Compliance with Highly Anonymous Virtual Asset Regulations.”

During the development of MWEB, this scenario was considered and considered by turning MWEB into subscription option. This means that exchanges and wallet providers can opt out of MWEB integration and circumvent regulatory requirements.

However, Korean exchanges decided not to risk using the opt-out feature.

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