Binance warns of the loss of funds for Litecoin transactions using the MWEB feature

Binance warns of loss of funds for Litecoin transactions using MWEB feature - binance 1260x835 1Last month, Litecoin developers launched an optional Litecoin transaction privacy feature. The Mimblewimble Extension Blocks (MWEB) feature allows Litecoin users to hide transaction data. However, it does not slow down the transaction processing speed. Following the launch of this feature, all South Korean exchanges (such as Bithumb and Upbit) delisted the coin last week.

These exchanges claim that this feature prevents them from tracking user transactions. As a result, they would not comply with anti-money laundering policies. Binance, on the other hand, has not yet canceled the coin. But it warned its users not to enable this feature when making their transactions in Litecoin. The announcement adds that users who enable Litecoin's transfer feature risk losing their funds.

The reason for this warning from Binance

Compared to South Korean exchanges, Binance supports privacy-focused coins. Proof of this is the inclusion of Monero, Zcash and other popular privacy coins on its platform. Binance's warning is therefore unlikely to have anything to do with regulatory compliance.

Instead, the most likely reason for this announcement is discomfort. It would be inconvenient for Binance to manage Litecoin transactions with the MWEB function and those without. It is important to note that no one can identify the cryptocurrency addresses involved in Litecoin transactions using the MWEB feature.

Part of Binance's notice reads: “We will not return or confirm receipt of all LTC deposits made through the MWEB feature to Binance. We do this because we cannot confirm the return address. Therefore, the sender and the recipient would lose these funds ”.

A group files a class action lawsuit against Binance.US

A group that claims to represent the interests of American cryptocurrency holders has filed a class action lawsuit against Binance.US. Binance.US is the US branch of the popular cryptocurrency exchange Binance. The group accused Binance.US of selling unregistered securities to buyers. Thus causing them to lose their hard earned money.

The complainants filed the complaint on June 13 in the Northern District of California. The group also said Binance.US 'business model is based on allowing "the illegal sale of unregistered securities to different cryptocurrency investors". Additionally, the complaint claims that Binance.US actively promoted UST sales to make huge profits from this stablecoin's increased transaction volume.

The complaint adds that Binance.US was selling UST without being licensed to do so as a broker. Therefore, Binance.US has committed a criminal act under US financial instruments laws. However, Binance.US has not yet released any official statements regarding the matter.

The aftermath of the collapse of the Earth

The effects of the collapse of the Earth network have been numerous. Over $ 40 billion was wiped from the entire cryptocurrency market in the 24 hours following the crash. This lawsuit could be the first of many similar lawsuits since last month's Terra network crash.

The success of this process would provide greater clarity on the legality of decentralized finance (DeFi). Furthermore, it would define who should be responsible in case things go wrong.