Dash does not want to be a “privacy cryptocurrency” and earns criticism
After being removed by Bittrex, Dash is fighting back against being classified as a privacy cryptocurrency.
A new tweet from blockchain company Dash has drawn criticism as the associated cryptocurrency, previously promoted for its focus on anonymity and Bitcoin Storm privacy, now stresses that it is similarly transparent to Bitcoin.
This was initially preceded on 1 January by a tweet from US crypto exchange Bittrex, which announced the day before yesterday that it was delisting privacy cryptocurrencies Monero, Zcash and Dash:
On 29 December, the crypto trading platform had already removed XRP from trading after the US Securities and Exchange Commission (SEC) filed an indictment against issuer Ripple. Accordingly, speculation now arose that Bittrex was removing the privacy cryptocurrencies in order to prevent another round-robin by the authorities.
In turn, Dash responded in a tweet that the company had requested a meeting with Bittrex. Moreover, it would be substantively wrong to call DASH a “privacy cryptocurrency”:
From a technical standpoint, Dash’s privacy functionality is no greater than Bitcoin’s, making the label of “privacy coin” a misnomer for Dash. We have reached out to @BittrexExchange to request a meeting with their compliance team. Hopefully this will be rectified soon. https://t.co/QA66OoshPn
– Dash (@Dashpay) January 1, 2021
However, the web archive for 2017 shows that DASH was promoted by the Dash Foundation as the “world’s first cryptocurrency with a focus on data protection”. The current version of the website, on the other hand, only talks about “the leading cryptocurrency for payments”.
In another response to Bittrex’s removal, Ryan Taylor, the CEO of Dash payment service Dash Pay, also downplays the cryptocurrency’s privacy feature:
10/ Dash’s PrivateSend feature is simply a branded implementation of non-custodial CoinJoin. Don’t take my word for it… industry leading experts like Chainalysis and Perkins Coie agree.
– Ryan Taylor (@RTaylor05) January 2, 2021
Even the built-in feature called PrivateSend
Because Dash is merely “an offshoot of Bitcoin”, all transactions would be publicly viewable, just like the crypto market leader. Even the built-in feature called PrivateSend, which is supposed to anonymise payments, would not really guarantee complete anonymity.
This tweet drew further criticism from the crypto community, but some users backed Taylor up by pointing to a Dash blog post from last August that explicitly explained the cryptocurrency’s privacy feature. In it, Taylor had written at the time that “regulators are concerned that crypto exchanges cannot comply with information collection (KYC) and anti-money laundering (AML) requirements when conducting transactions with privacy cryptocurrencies”. To address the authorities’ concerns, other crypto exchanges had delisted Dash in the past.
However, this has always been a misunderstanding, as Dash is often referred to as a privacy cryptocurrency, which it is not. Accordingly, the blockchain company is working to clear up this misunderstanding:
“Through our educational efforts, we have managed to explain the technology we use and convince authorities that Dash does not pose a greater risk than Bitcoin.”
The renewed clarification through the latest tweets comes just days after Dash announced it had moved its proprietary blockchain platform to the testnet. Meanwhile, the cryptocurrency’s share price has lost 3% today and now stands at US$87.71.