Thursday, October 5, 2023

MimbleWimble’s Privacy won’t Aid Criminals


The long-awaited MimbleWimble upgrade arrives. However, there are concerns about its ability to facilitate money laundering and how regulators will react.

Charlie Lee, Litecoin’s founder, is indifferent about MimbleWimble’s new privacy features benefiting money launderers or a potential governmental response.

Not as Anonymous

The MimbleWimble protocol allows for scaling by compressing history, making data easier to handle and verify.

Cryptographic procedures use also to encrypt block inputs and outputs. This means that blocks confirm as usual, but an outsider cannot tell which of a block’s inputs and outputs belong to.

This encryption method, according to Lee, is a must to make Litecoin fungible. To put it another way, by making all $LTC the same, they are all treated the same, just like a currency.

Criminals who use Litecoin to conceal their actions pose a potential hazard. Lee responded by saying that financial privacy is a human right. In any event, because MimbleWimble is an optional feature, he’s convinced that regulators won’t raise an objection.

He explained that this is an optional opt-in to using MWEB. Exchanges, for example, would not have to deal with the MWEB side of things; instead, they could focus on the open Litecoin blockchain.

Rather than providing “total anonymity,” Lee explained that MimbleWimble’s primary purpose is to provide a degree of financial privacy by disguising amounts held. The exchanges still know your personal information when you deposit.

He mentioned that hiding the amount he thinks is important for financial privacy. It does not make it easier for individuals, criminals, or other malicious individuals to launder money using Litecoin.

Reasons for Delay

Since 2019, there has been a talk of the Litecoin MimbleWimble update. The Litecoin Foundation, however, announced its launch at the end of January, following years of development.

One of the first changes is the renaming of the protocol extension to MWEB, which refers to MimbleWimble Extension Block, according to Lee.

Lee explained that Litecoin is a multi-billion dollar currency that people use every day, which is why MWEB took so long to create. The top objective was to keep the network up and functioning, which necessitated a cautious approach.

He wanted to take things slowly to ensure a smooth upgrading. They don’t want to take any additional risks, such as causing the network to fall down or causing issues with people’s money.

$LTC reached an all-time high of +8% on the MWEB release before retracing somewhat to close Tuesday at $115. The lackluster performance is likely attributable to larger market headwinds since Bitcoin only gained 2% in the same time frame.

Jacob Yang
Jacob Yang
Jacob Yang works at Cryptoconstellation as a writer. He has been working in finance for the past 6 years. Jacob loves sharing news about the cryptocurrency world and he, himself has invested in a few. Jacob enjoys travelling and finding the best restaurants wherever he goes.

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