Privacy-focused cryptocurrencies have come under immense scrutiny amidst concerns criminals are using them to fuel illegal activities. Law enforcement agencies as well regulators around the world have waged crackdowns against such Altcoins amidst claims they fuel money laundering activities.
Japan is one of the countries that has gone the extra mile and consequently banned all privacy-focused coins. The coins continue to elicit strong interest in part because they make it impossible to track transactions as is the case with other cryptocurrencies. Their tight proof nature has seen them become popular in the underworld.
However, privacy coins are not just for fuelling suspicious and illegal activities. The coins are increasingly finding new applications in day to day operations at the backdrop of increased scrutiny and crackdown.
Privacy Coins for Personal Security
Wealthy cryptocurrencies holders are turning to privacy Altcoins to hide their wealth and obfuscate transactions they carry out. They are also using the privacy coins to hide the amounts of currency they have in their digital wallets.
Hackers had initially perfected the art of tracking bitcoin holders depending on the transactions they carried out on public ledgers such as Bitcoin and Ethereum. By leveraging the security and privacy of the likes of Zcash, Monero, and PIVX, the holders are now able to keep hackers at bay.
Business Transactions Privacy
Businesses that accept cryptocurrencies payments stand a higher risk of losing their completive edge. One of the biggest disadvantages of cryptocurrency transactions is that they occur on a public ledger that everyone has access to.
That said, clients can track payments that a business receives from time to time and get a clear idea of what other clients are paying, say for the same product or service. What this means is that some clients could demand some discounts if they believe they are overpaying.
With the likes of Monero and Zcash, it is impossible to track financial transactions on a ledger thereby allowing businesses to protect the privacy of their operations.
Averting Tainted Coins Dilemma
Tainted coins are becoming a common phenomenon that has left people with huge valueless holdings that they cannot use anywhere. What happens is that whenever a normal cryptocurrency is used for illegal activities, it is blacklisted.
People with blacklisted coins find it hard to use them given the amount of scrutiny that comes as well the fact that people and exchanges turn to don such transactions. However, that is never a problem with privacy-focused coins. With anonymous coins, it is impossible to identify tainted coins.
Freedom of Use
Channeling cryptocurrency payments to counterculture groups, as well as political dissidents and social activities can at times be a big problem. This is especially the case if authorities or the government is against the same.
Making payments using normal cryptocurrencies is never an option as authorities can track the same and know where the payments came from. However, with anonymous coins, one can make payments to their group or organization of choice without having to worry about anything.
Financial Data Protection
Corporations and governments are in constant pursuit of people’s financial data. Such data is used for all sort of activities key among them being gauging individual’s financial behavior. To counter the threat of such entities gaining access to financial data, people are increasingly turning to privacy-focused Altcoins.
Bitcoin might be less traceable than debit credit cards. However, it does not offer the same level of privacy that comes with privacyAltcoins especially in protecting the transaction trail.