Privacy coins have faced strict regulatory crackdowns in recent months. Privacy-focused blockchain “Horizen”, has announced that all Privacy features will be removed at the consensus level following the approval of ZenIP 42204.
PREVENT SUPPORTING PROTECTED TRANSACTIONS AT THE CONSENSUS LEVEL
In an official blog post, Horizen announced that the community has approved ZenIP 42204 for “deprecating” the protocol’s protected pools, which calls for removing protected transactions with heads into transparency from the main chain.
Following the deprecation of mainchain security pools, all privacy features will be removed from Horizen's main blockchain at the consensus level, which means its native coin ZEN will no longer be a Privacy token again.
Horizen cited global regulatory threats as well as other technical debt as reasons for the move.
The purpose of the deprecation is to ensure Horizen implements security technology in the right and sustainable way to promote ecosystem growth and minimize risk. It proposes a solution to eliminate technical debt and avoid legal threats that could prevent the larger Horizen community from fully and freely participating in our ecosystem.
REGULATORY SPRESSIONS ON PRIVACY MONEY
Regulators across various jurisdictions have taken steps to ban Privacy-enhancing cryptocurrencies in one form or another. Earlier this year, Dubai's Virtual Assets Authority (VARA) banned all activities related to Privacy coins such as Monero (XMR) and Zcash (ZEC) in a bid to prevent illegal activities.
Cryptocurrency giant, Binance, is facing stringent regulatory scrutiny in the United States as well as other key jurisdictions, having previously announced plans to delist the Privacy coin for users in France, Italy, Spain and Poland, leaving them unable to buy or sell at least 12 tokens. However, this decision was reversed after amending operations to comply with local European regulations.