Trying to ban private cryptocurrencies would be nearly impossible for regulators due to the decentralized nature of privacy tokens, according to a study published in the Journal of Information Technology.
Anonymous coins work differently from cryptocurrencies such as bitcoin and ether – payments are not tracked, which helps users maintain privacy. Highlighting the difficulties regulators might face in banning anonymous coins, Copenhagen Business School researcher Rob GLEASURE said that if privacy-focused decentralized currencies such as Monero become popular in the future, such coins could be exchanged without being converted to other currencies.
Gleasure suggested that it would be useful for the authorities to adapt and prepare for the fact that in the future they will not be able to prevent the spread of anonymous coins. He also thought about an alternative outcome whereby governments would accept private cryptocurrencies. He says relaxed rules and a deeper understanding of coins like bitcoin could lead to wider adoption of privacy-focused coins.
Given the stages in the development of the cryptocurrency space as a whole, it is not yet clear whether anonymous cryptocurrencies will ever become widespread, and how exactly the authorities will try to root out payment systems that are focused on privacy.
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