The analytics firm Elliptic added tools to the platform for tracking transactions on the Litecoin blockchain following the activation of the MimbleWimble Extension Block (MWEB) update.
Elliptic is the first blockchain analytics provider to support the Mimblewimble privacy feature on Litecoin keeping regulated businesses compliant with anti-money laundering regulations and sanctions.https://t.co/qpzLpVqzZh#litecoin #mimblewimble
— elliptic (@elliptic) May 27, 2022
On May 19, the Litecoin network activated the MWEB update. The MimbleWimble protocol uses several technologies, including confidential transactions and CoinJoin, which hides the inputs and outputs of senders and recipients, and also merges multiple transactions into one.
“This poses a problem for companies involved in LTC transactions. They must comply with anti-money laundering rules or prevent sanction circumvention. Information [about senders and recipients of transfers] such entities use to assess risk,” the press release says.
Earlier, Litecoin delistings were permitted on Bithumb and Upbit following the activation of MWEB. The platforms said they operate in accordance with South Korea’s laws requiring AML and counter-terrorism financing measures.
The companies stressed that their policies provide for delisting of an asset if it “violates laws, government decrees, and the regulations of financial authorities”.
Elliptic explained that the launched tool is not aimed at tracking or de-anonymising Litecoin users. The solution enables a client to determine whether a transaction or wallet contains funds that were added using privacy features.
“Compliance professionals can use these data to assess risk and conduct further, comprehensive checks,” the companies added.
Back in 2020, Elliptic introduced a similar solution for the cryptocurrencies Zcash (ZEC) and Horizen (ZEN).