Five South Korean cryptocurrency exchanges recently said they will delist litecoin because the crypto asset’s Mimblewimble Extension Blocks (MWEB) upgrade violates the country’s laws. As a result, the exchanges’ users cannot use the Korean won to trade the crypto asset, which has since been named a “dark coin.”
Upgrade Violates Specific Financial Information Act
Following the recent Mimblewimble Extension Blocks (MWEB) upgrade to litecoin, five of South Korea’s major cryptocurrency exchanges, namely Upbit, Bithumb, Coinone, Korbit, and Gopax, responded by announcing that they would delist the crypto asset. The exchanges argue that the upgrade has made litecoin transactions anonymous, which is against the country’s laws.
According to a News1 report, the anonymity that was brought about by the Mimblewimble upgrade violates a provision in the Specific Financial Information Act which stipulates that cryptocurrency exchanges cannot handle crypto coins that hide transfer records.
In a statement, Upbit reportedly said:
According to the Special Act, exchanges must check whether the transmission records can be verified for digital assets with anonymous transmission technology, and take appropriate measures if anonymous transmission technology is found.
In May, a statement from the Litecoin team said the “highly anticipated” MWEB upgrade had been activated. The statement explained that the upgrade “is a fungibility-improving technology that enhances confidentiality between the senders and receivers in a transaction.” The amount being sent is only known between the sender and receiver, the statement added.
However, as a result of this upgrade that has seen LTC being labeled a dark coin, users in South Korea cannot trade the crypto asset using the won currency on these exchanges. Nevertheless, the News1 report said the exchanges have resolved to continue supporting LTC withdrawals for at least a month.
What are your thoughts on this story? Let us know what you think in the comments section below.
Image Credits: Shutterstock, Pixabay, Wiki Commons
Disclaimer: This article is for informational purposes only. It is not a direct offer or solicitation of an offer to buy or sell, or a recommendation or endorsement of any products, services, or companies. krakow3d.com does not provide investment, tax, legal, or accounting advice. Neither the company nor the author is responsible, directly or indirectly, for any damage or loss caused or alleged to be caused by or in connection with the use of or reliance on any content, goods or services mentioned in this article.