What Is the Regulatory Concern Surrounding the Use of Privacy Coins?

The primary regulatory concern is the potential for privacy coins to be used for illicit activities like money laundering and terrorist financing. Their enhanced anonymity makes it difficult for financial institutions and law enforcement to trace the flow of funds.

This lack of transparency conflicts with Anti-Money Laundering (AML) and Counter-Financing of Terrorism (CFT) regulations. Consequently, some jurisdictions and exchanges have restricted or banned their use.