Japan’s Financial Services Agency (FSA) is pressuring regulated exchanges to no longer list three of the biggest anonymity focused cryptocurrencies: Monero, Zcash and Dash.

According to a report by Forbes, un-named sources close to FSA have “confirmed that they were taking all available steps to discourage the use of certain alternative virtual currencies that have become attractive to the underworld because they are difficult to track.”

This seems to be in light of one of the biggest exchange hack earlier this year which led to the theft of half a billion dollars worth of NEM – a private/public hybrid blockchain based crypto popular in Japan – from Coincheck.

Coincheck has now dropped Monero, Zcash and Dash, with Forbes further stating: “The FSA has also informed other exchanges applying to be registered, that dealing with these three highly anonymous cryptocurrencies would be detrimental to gaining approval.”

The regulator is now seemingly considering whether to ban the three cryptos, or whether to just ban exchanges from listing them, in a curious twist which might provide context for recent Binance related events.

Last month, FSA warned Binance to halt operations in the country or face criminal charges. In the published warning, FSA did not really give a reason, but AML/KYC requirements were cited elsewhere.

If we are to speculate, it may well be all of this is connected to the hack of half a billion dollars worth of NEM. The thieves may have taken out the criminal proceeds through Monero, Zcash or Dash and may have then sent them to Binance.

We do not know if any of that is the case, but there were suggestions that some of the $150,000 worth of eth stolen from MyEtherWallet were sent to Binance.

Just how anonymous Monero is, remains an open question. Zcash is probably very anonymous, but they have a weakness, at least theoretically, in the initiation ceremony. While Dash is probably the weakest out of the three in anonymity.

All three have very low usage, with only 5,000-10,000 transactions a day each, compared to nearly a million for eth and some 200,000+ for bitcoin.

Their trading volumes are a bit healthier, at around $250 million in combination for the past 24 hours, but, by comparison, that’s around 10% eth’s volumes of $2.6 billion and even less of a percentage compared to bitcoin’s $8 billion 24 hours trading volumes.

Moreover, when it comes to hacks or other such activities, they’re probably mainly used to escape links between btc to btc address, by obfuscating through say btc-xmr-btc. In such instances, a ban might not be very effective and might perhaps even lower what could be hints for investigators.

Enforcement of AML/KYC requirements for exchanges would probably be more effective, but even there, with decentralized exchanges, detectives might have to simply rely on old fashioned methods.

Copyrights Trustnodes.com