Most exchanges do need to be able to verify the source of your coins.
So if your LTC coins go through MWEB will that make them unusable? In the sense that exchanges will treat them as "high risk"?
So those coins will be fungible, but only in the sense that exchanges and merchants will treat them all equally to "darknet coins"?
EDIT: I don't mean to FUD, am genuinely concerned!
Posted Mar 17, 2021, 10:27 AM UTC · edited
Good question i am afraid about this new functionality added to LTC too.
MW is not yet added to LTC, code was just completed and it is under revision before being integrated, still months to go for that to happen
Best to start asking relevant questions as early as possible.
Mimblewimble will be an optional feature
https://cryptobriefing.com/litecoins-mw-privacy-feature-is-now-code-complete/
Litecoin MWEB is specially designed to be unusable by concern trolls, so they have nothing to be anxious about
Wait till you get one of these:
https://twitter.com/Marty_P_B/status/1366737347887456260
But instead of "mixers" their excuse for not accepting your coins will be a generic "you used privacy features".
You think those UTXOs will have the same value as "clean" ones?
Don't downvote, instead clear my concerns with some arguments!
yeah people just dont want to acknowledge it as a possibility
Possibilities don't matter if a person doesn't ask anyone who would have an answer. Asking questions like this to the general community is retarded and very much in FUD territory when all he has to do is contact all of the exchanges. His question will be answered after he gets some replies. He can even choose to make a post about it and inform others.
I agree, somewhat, no point in asking here, but most people just seem scared of the thought
Xmr spends most of it's life worth more than LTC. Your trying to fud that LTC will be worth less because exchanges don't like privacy. Case and point is XMR wothless, no? Take your fud elsewhere.
You are only considering CENTRALIZED EXCHANGES, this is extremely ignorant and naïve. We are rapidly moving away from this model as a community. Dex/p2p/atomic swaps are the future which none give a flying fuck about central exchanges. There is a market for privacy in finances, market will prevail.
I didn't mean Litecoin as a whole but specific "tainted" coins/utxos. Yes more liquidity on Dex/p2p/atomic swaps would solve this.
tl;dr I think it's pretty unlikely. I could see exchanges maybe blocking MWEB out and in but I don't think they would care if coins had ever touched MWEB. After a few transactions it's not really their problem. If they do though then it's pretty simple to just not use MWEB for coins you want to sell on an exchange. Just would be a shame for a feature like this to go unused if that happens. Also just Charlie has connections with pretty large exchanges so I imagine he'd be aware if this was an issue or not and be able to smooth things over.
Copying and pasting from another reply but my take:
A valid question, a few exchanges have removed privacy coins in the past or refused to use them in the first place in fear of regulatory issues.
However, a lot of this comes from the fact that regulatory bodies are pushing for exchanges to potentially have some level of KYC not just on the account but also on wallets money is being sent to outside of the account. This is a bit of a silly requirement because you could just have a KYC wallet you transfer to then transfer it again to a non-KYC wallet but that's beside the point. Mainly with privacy coins there's basically no option to really have a KYC wallet so that's the problem. With Litecoin, MWEB is optional so it would be pretty simple for exchanges to simply not allow MWEB transaction in to or out of the exchange.
Litecoin is also so established I doubt this would actually affect it and if anything might make it a very popular coin since it would be one of the oldest mainstream coins to support some level of additional privacy now.
In my opinion, and this is not financial advice, this is actually one of the best times to buy as Litecoin may be the first mainstream crypto to have optional privacy and is basically already on every exchange and would be difficult to remove without pissing off one of the larger and oldest crypto user bases. Could bring in a very large renewed interest in Litecoin while Litecoin also being potentially regulation proof.
However it's always a risk I guess some exchanges could get spooked and remove Litecoin even if it is optional, but it's pretty unlikely in my opinion. If exchanges don't remove Litecoin (which I think is very unlikely) then it suddenly just became a lot more appealing and this also paves the way for Bitcoin to potentially adopt MWEB (and good luck delisting Bitcoin and still having people take your exchange seriously).
Thanks or your exhaustive answer. Makes me a bit less concerned about this mweb :)
Will you be able to use a legacy wallet for transferring with exchanges still? Just keep a legacy wallet around maybe.
Yes, that's the opt in part.
But what if someone sends you coins he used in a MWEB transaction?
Make sure they don't send it to an exchange first?
Edit* sorry if I dont get it. If you have control - and can send it to a legacy wallet - and the exchange accepts legacy wallet transactions, no issue?
Exchanges check the complete history of each coin/UTXO.
Before it's considered a valid deposit? First I've heard of that. Interesting.
No they don't. There's no such thing as "complete history". Abandon this nonsense belief in tracing every coin back to its mining origin. It's impossible because it's a multi-path trace which rapidly spreads to thousands of paths after only a few back steps
Find a block explorer. Pick a transaction. See how far you can trace it back. You only need to click the links. Keep a tab open for each back link. You'll give up before you've opened 50 tabs
Have you asked any of the exchanges?
of course not
maybe when too many users use this
[removed]
MWEB is opt-in. Exchanges and platforms who need to know information about the transaction don't have to enable the privacy option.
If your coins were used in a MWEB transaction, exchanges will not be able to see their origins, regardless of what they opt into.
Exchanges can also straight up deny any transactions using MWEB in a policy statement... But most exchanges don't care about the transaction you did 10 transactions ago. They just want where it came from.
Actually, they care a lot about a coins history. Most exchanges don't accept bitcoins that went through a mixer.
So my concern is mainly if it will be obvious that a coin was part of a MWEB transaction. If yes, exchanges will surely treat them as coins from mixers.
This is false. You made it up
I don't know if this is true, there's only been a few instances of this being reported and it's never really verified. Mixing is also a little bit of a different bag since mixing services can be illegal with existing laws in most countries just by their natures since money is changing hands and you have people acting as transmitters and launderers.
If you were to mix your own coins I don't think it would be illegal or something exchanges would care about, it's just fingerprints that trace back to known illegal operations I feel like they are probably getting pressure on.
MWEB really just adds fungibility and makes it more like a precious metal. You sometimes have to provide KYC or proof where you got your metal to sell at legitimate exchanges, but they didn't just ban gold because it's untraceable.
Absolutely, that's what i'm afraid of, that using MWEB will make your coins unusable on exchanges.