Tuesday, January 31, 2023

DASH, Monero and Zcoin Soar as Traders Turn to ‘Privacy Coins’

DASH, Monero and Zcoin Soar as Traders Turn to ‘Privacy Coins’

Rival privacy coins DASH, Monero and Zcoin are hovering around all-time-high prices this week — with DASH in particular standing out by topping and staying above $500 USD. Are holders starting to worry about the attention they receive?

Also read: Using Bitcoin and Virtual Currencies Is Illegal, Says Morocco Central Bank

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DASH Over $500, Is the Third-Most Expensive Digital Asset

DASH has gone from a mere $265 at the end of October to $516 at press time, holding above $500 for over a day. Per unit, it’s the most expensive digital asset after BTC and BCH.

Monero is just a few bucks short of its all-time high of $152 at $146, while Zcoin leapt a whopping 53 percent in the past 24 hours to hit its ATH at $37.27. At the end of October, it was $13.

Zcash also made gains, though it’s still $100 short of the ATH it set in June 2017 when it topped $400.

Are Investors Turning to Privacy Coins?

Although it’s been a good week for altcoin gains all round, these privacy coins have done better than nearly all others. Is it a coincidence, or is there a rush to digital assets that claim to protect users’ privacy?

hacking hacker privacyInvestors may be tired of the Bitcoin/Bitcoin Cash battle for attention, or are skeptical of where the value is coming from. Both rival assets’ prices have dipped in the past week and made only modest gains since — are investors looking for other known brands instead?

There could be a general shift towards so-called “privacy coins” as governments and tax authorities show increased interest in transaction histories and capital gains. Recently, Bloomberg reported that popular exchange Coinbase would probably lose its long fight to shield users’ full financial activities from the IRS.

The 2017 crypto boom has led to massive gains for some, especially in novelty ICOs and existing sleeper assets like ether, litecoin, and Ripple XRP. It has also led to fears of massive tax bills if the assets are converted back into fiat.

Private Transactions Only Part of the Answer

However, no matter how anonymous transactions between privacy coin addresses may be, they’ll be noticed like any other cryptocurrency if traded back into fiat. Therefore, if their utility is rising due to anonymity features, there’s some other reason for that. Perhaps someone needs to move large amounts of money unnoticed?

money launderingPrivacy coins are also useful as a vehicle for masking crypto holdings — trade in, send to a new address, then convert back on a completely different exchange. If the privacy features work as they claim on the box, the money is effectively laundered. This can be done on various crypto-only exchanges that don’t have full KYC requirements.

Though cryptocurrencies’ value may be “based on nothing” (according to critics), the longer they exist without suffering any major technical embarrassment only strengthens their claims of reliability.

So far, DASH and Monero have been generally reliable. Zcash and Zcoin still have something to prove, but users will be watching them with interest.

What’s your theory on the popularity of privacy coins? Let’s hear your thoughts.

Images via Pixabay

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