Opinion: The advantages of anonymous cryptocurrencies far outweigh their risks

Monero, Zcash, Dash and Grin coins oriented toward heightened anonymity are used less frequently for money laundering than other cryptocurrencies and do not require additional oversight. This was stated by staff at the law firm Perkins Coie.

Is it possible for regulated entities to comply with anti-money laundering obligations when supporting #privacycoins? @DanaSyracuse, Joshua Boehm and Nick Lundgren, with contributions from @tari, explore this question in an informative white paper: https://t.co/nTqmJ6QsW7 pic.twitter.com/Q2UhDRQFYo

— Perkins Coie (@PerkinsCoieLLP) September 15, 2020

They argue that the advantages of anonymous coins significantly outweigh their risks, and that the current global regulation of cryptocurrencies can effectively combat the laundering of criminal proceeds and does not require tightening.

“Private coins have lower money-laundering risks than other cryptocurrencies when considering evidence of their illicit use in practice,” said representatives of Perkins Coie.

According to the Seattle-based firm, more than 90% of darknet-used cryptocurrency addresses belong to the Bitcoin blockchain, and only 0.3% to Dash, Monero and Zcash combined.

In December 2019, the Swiss Financial Market Supervisory Authority (FINMA) said that blockchain and cryptocurrencies increased the risks of money laundering through the country, posing a threat to its reputation as a financial centre.

That same year, Messari analysts noted that traditional money is used for money laundering 800 times more often than Bitcoin.

In August 2020, the Monero cryptocurrency community and privacy-protocol developers from Tari Labs announced the release of a guide for exchanges on dealing with privacy-focused cryptocurrencies. Publication of the document “Fundamental Factors and Regulation of Privacy-Preserving Cryptocurrencies” will be handled by Perkins Coie.

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