Cryptocurrency is a decentralized financial system that needs no rules. The ideology of cryptocurrency is to protect privacy. Privacy data is something that is very valuable. A giant social media can earn a lot of income from advertising companies because they hold million users data around the world. Users do not realized that they have sent data privacy when they register a social media platform. They should send email address, phone numbers, age, and even some details about hobby. Cryptocurrency protect users data by anonymous address however the transaction in most crypto is traceable. Privacy coins developers and enthusiasts still see that traceable ledger of transaction is not private. Then, they create coins that can not be traced at all like monero and other coins. Some coins hide the wallet address by creating multiple new wallet after making transaction.

Image source : https://pixabay.com/illustrations/analytics-information-innovation-3088958/

What are privacy coins?

Privacy coins are cryptocurrencies that keep your transaction hidden or anonymous and untraceable. There are some privacy coins. They are ( Dash ), Zcash, Monero, Pivx , Verge and Hush. There are actually more privacy coins in the market. One who uses privacy coins does not want his transaction known by others or government. Privacy coins usually hide transaction hash, and create multiple address so the transaction is not traceable.

AML / KYC

Anti-money laundering (AML) regulations are mandated by both national and international authorities around the world and place a wide variety of screening and monitoring obligations on financial institutions. Those AML obligations include the Know Your Customer (KYC) process.
KYC / AML complyadvantage.com/knowledgebase.

Dash rejects allegation of a privacy coin

Dash in the early development was a privacy coin. However, dash core developers make it become a digital cash. It means that cryptocurrency that will be widely used for payment system. Now dash is accepted by thousands merchants. Dash core also planned to talk to Bittrex management to reclaim that dash is not a privacy coin.

In response, Dash announced in a tweet that they had “reached out to @BittrexExchange to request a meeting,” and that referring to DASH as a “privacy coin” is a misnomer

The clarifications about Dash’s core focus follow an announced upgrade to Dash moving to the testnet phase, an upgrade which will include DashPay, a “social crypto payments wallet.

https://cointelegraph.com/news/following-delisting-dash-pushes-back-against-privacy-coin-label

Cryptocurrencies protect privacy in ideology. They are different from banks and digital payments. CC , Paypal, Paiza and other payment systems show users identity to the service providers. While bitcoin and cryptocurrency, the identity of wallet holders are hidden. Principally, bitcoin and other cryptocurrency are privacy payment system. Transaction hash on blockchain ledger is public. That makes different from bitcoin and privacy coins. Privacy coins hide all transaction hash and address. Bitcoin transaction is traceable but monero, Zcash and other privacy coins are not. Hidden transaction and address are not compliant with regulatory for cryptocurrencies in US and other countries. Though privacy coins are not compliant with regulators , the need of privacy coins still high. There are some reasons why people still need privacy coins.

Businesses may have trade secrets or a list of clients and suppliers they want hidden. As a user, a safety concern arises as hackers could easily find and target large holders. Privacy coins are meant to help give users a degree of anonymity in a robust and decentralized manner.

https://coincentral.com/privacy-coins-what-are-they-how-do-they-work-and-why-are-they-needed/

The purpose of privacy coins is to protect fund from hacking and any other attempts to steal the user identity but some users use privacy coins to do crimes like money laundering and illegal transactions. That is why some regulators do not accept privacy coins as the legal coins to be traded in exchanges that need strict KYC and AML requirements.

The future of privacy coins

Though some regulators are strict and ban privacy coins circulation, users of the coins do not get influenced too much. They still use and hold the coins. In the future, privacy coins will be used by their fans. Developers and users of privacy coins will not compromise with AML / KYC. That is not a matter of rules but it is ideology behind using privacy coins.

Posted Using LeoFinance ^Beta