Token Metrics
Hey folks.
In order to completely protect their users' anonymity, privacy coins use advanced cryptographic mechanisms to conceal transaction data from the general public.
not like Bitcoin, Ethereum and other crypto, privacy coins don't disclose the addresses of senders and recipients, the funds transferred or even balances of the wallet.
Famous examples of privacy coins include, Zcash (ZEC), Monero (XMR), DASH and a few others.
Proponents of Bitcoin emphasized privacy and anonymity as important benefits, but in practice, the cryptocurrency has become very easy to monitor because of blockchain intelligence tools that can link public keys to their owners. After authorities imposed KYC policies on cryptocurrency exchanges, this got even simpler.
Former prosecutor turned crypto venture capitalist, Katie Haun acknowledged that blockchain made it easy to track down criminal activity.
She said,
“Without the technology underlying bitcoin, we never would have been able to catch those people.”
Setting aside the possibility of abuse, the goal of privacy coins is to provide regular users more financial autonomy and control.
The key benefits of privacy coins are security, financial privacy and censorship resistance.
It is possible for investors to evade having their transactions monitored and tracked. This helps criminals, but it also helps those living in nations with repressive or totalitarian governments.
Data leakages which have become more frequent during the last few years, can also be prevented by privacy coins.
Financial regulators are putting more restrictions on privacy coins because of the possibility that they will be used for illicit purposes.
For instance, they are wholly prohibited in Japan, and South Korea's cryptocurrency exchanges do not allow you to trade them.
Although privacy coins are still legit in the United States and the European Union (EU), regulators are having a close look at them and may impose restrictions, quoting anti-money laundering risks.
Not financial advice.
@haveyoursay