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Bitcoin's (BTC) Privacy in Danger as Crypto Companies Clamp Down on Coin Mixing Services: Jameson Lopp

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Wed, 01/29/2020 - 18:04
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Alex Dovbnya
Multiple crypto exchanges are stepping up their efforts to block anonymous cryptocurrency transactions, and Jameson Lopp sees this as an attack on Bitcoin's privacy
Bitcoin's (BTC) Privacy in Danger as Crypto Companies Clamp Down on Coin Mixing Services: Jameson Lopp
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Cypherpunk Jameson Lopp recently slammed numerous cryptocurrency companies for clamping down on privacy-preserving services. 

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Bitcoin Reaches Its Highest ‘Anonymization’ in Five Years. Does It Threaten Monero and Zcash?

An alarming level of chain analysis 

Paxos recently followed of other crypto exchanges that want to prevent any CoinJoin transactions. Twitter user Ronald McHodled recently shared an email from the company's support team, in which he is asked to clarify whether or not there was a withdrawal to "a known mixing service" from his account.  

McHodled explained that he didn't use coin mixing for nefarious purposes and compared it to using an ATM or putting your cash under a mattress.        

"Fortunately that's not how Bitcoin works, but the level of chain analysis here is alarming," he wrote on Twitter. 

Back in December, Binance Singapore sent a warning to its customer who happened to send coins to privacy-oriented crypto wallet Wasabi.      

Related
Bitcoin (BTC) Crime: British Man Gets Nine Years in Prison for Selling Lethal Drugs

The battle over privacy 

The CoinJoin technology, which was introduced by cryptographer Greg Maxwell in 2013, allows grouping a bunch of Bitcoin transactions to obfuscate the addresses that stand behind them. It is now widely used by those who want to preserve their privacy.     

The fact that centralized companies can close the account of people who use CoinJoin proves that the next big battle will be over privacy. According to Lopp, those businesses that crack down on anonymous payments will end up on the wrong side of history.   

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About the author

Alex Dovbnya (aka AlexMorris) is a cryptocurrency expert, trader and journalist with extensive experience of covering everything related to the burgeoning industry — from price analysis to Blockchain disruption. Alex authored more than 1,000 stories for U.Today, CryptoComes and other fintech media outlets. He’s particularly interested in regulatory trends around the globe that are shaping the future of digital assets, can be contacted at alex.dovbnya@u.today.