The launch of MimbleWimble Extension Blocks (MWEB)
SEC’s order to delist Litecoin from exchanges in Thailand
Litecoin delisting from exchanges worldwide
Will MWEB be implemented in Bitcoin?
Many crypto investors may have noticed that Litecoin is being delisted from several trading services, including in Thailand’s and Korea’s cryptocurrency exchanges.
The reason for this is that Litecoin’s Lightning network has enabled the MimbleWimble feature for transaction privacy. The feature goes against the rules regarding the concealment of information in many countries, including Thailand’s Security and Exchange Commission (SEC).
Read on to find out more about what Litecoin’s MimbleWimble upgrade is, how it works, and its effects. Of course, we will also discuss why MimbleWimble contradicts SEC rules in many countries, which resulted in LTC being delisted from several exchanges.
The launch of MimbleWimble Extension Blocks (MWEB)
MimbleWimble: It is a Litecoin upgrade to enhance the network’s privacy and transaction size.
MimbleWimble is a privacy and transaction size upgrade on the Litecoin network. It took place on 19 May 2022 with the purpose to enhance transaction privacy for users.
Blockchain networks share one foundational aspect: being a decentralized, transparent means of payment. Therefore, every transaction that includes users’ location or the number of assets must be disclosed across the network. This has led to concerns about users’ privacy.
With MimbleWimble, Litecoin users are allowed to transfer the coins to the extension blocks, Litecoin parallel blockchain, stored on the Litecoin network. When there is a transaction on a Litecoin block, the information about the user’s location and the asset amount will be completely concealed and can be visible only to the relevant parties.
Extension blocks: Extension blocks are Litecoin’s parallel blockchain, stored on the Litecoin network. Users can transfer their coins between the extension blocks and the main chain.
For MimbleWimble, the fund transfer into the blocks is called ‘Pegging-in’, while ‘Pegging-out’ refers to the fund transfers out of the block and into the main chain.
When pegging in, users are required to create a specific pegging-in transaction and send it to MimbleWimble’s extension block, MWEB. Then, the system will start processing the transaction in the block.
To peg out of the extension blocks, users have to create a pegging-out transaction to transfer funds onto Litecoin’s main chain. The transfer is complete when six blocks’ transactions are confirmed by the system.
The advantage of MimbleWimble is that there is more user privacy compared to the main chain. In addition, Litecoin can be transferred from the extension block to the main chain for transparency.
SEC’s order to delist Litecoin from exchanges in Thailand
After the launch of MimbleWimble, Litecoin was delisted from several digital asset exchanges under the orders of SECs worldwide due to the transaction information’s concealing feature.
On 17 June 2022, the Thai SEC announced that digital asset exchanges are not allowed to enable the usage of any asset with transaction concealment features for investors, effective from 1 April 2022. The regulation resulted in Litecoin’s delisting from many exchanges.
Litecoin delisting from exchanges worldwide
Apart from Thai exchanges, many exchanges around the world have delisted Litecoin as well. As reported by Decrypt, the two biggest Korean exchanges, Bithumb and Upbit, also delisted Litecoin due to the privacy feature.
The two exchanges mentioned that they removed the coin in consequence of the MWEB upgrade which was against South Korea’s Anti-Money Laundering (AML) rule.
Moreover, according to CryptoPotato, three more South-Korean exchanges, Coinone, Korbit, and Gopax also have delisted Litecoin in response to the country’s law.
However, most of the U.S. trading exchanges still have Litecoin available for trading, such as Coinbase, FTX US, and Binance US.
Will MWEB be implemented in Bitcoin?
Litecoin is known as Bitcoin’s new technology implementing simulator. To illustrate, Litecoin originally implemented SegWit transaction scaling upgrade in May 2017 before Bitcoin’s SegWit launch a few months later, or even the launch of Layer-2 on the Lightning network in May 2017 before it got enabled on Bitcoin in March 2018.
At the moment, Bitcoin’s developers are keeping an eye on MWEB1’s performance and how beneficial it is for the users as privacy is one of the most important issues in the world of blockchain. Besides, Bitcoin and other cryptocurrency may find a way to adapt the use of MWEB1 feature to protect their user privacy in the future.
MimbleWimble or MWEB is a privacy upgrade on the Litecoin network. It allows blockchain users to complete the transactions without disclosing their location and the asset amount. However, the feature is against some countries’ SEC rules which stated that such action was classified as information concealing.
Therefore, Litecoin has been delisted from several trading exchanges worldwide. Apart from that, Bitcoin may also implement the privacy feature on its network in the future which investors and developers are following the news closely since privacy and transparency are the main characteristics of both blockchain and DeFi.
Disclaimer: The information provided in this article is not intended to provide investment or financial advice. Investment decisions should be based on the individual’s financial needs, objectives, and risk profile. We encourage readers to understand the assets and risks before making any investment entirely.
