Monero (XMR) saw a sharp 5% decline following Kraken’s announcement that it will discontinue support for the privacy-focused cryptocurrency in the European Economic Area (EEA) by the end of October.
The move comes in response to mounting regulatory pressures in the region, according to a statement from the exchange on October 1.
Kraken stated that as of October 31, 2024, at 15:00 PM UTC, it will halt trading and deposits of all Monero markets, including XMR/USD, XMR/EUR, XMR/BTC, and XMR/USDT, for EEA-registered clients. Open Monero orders will be automatically closed at this time.
While Monero trading will be restricted, Kraken users in the EEA will have until December 31, 2024, to withdraw their holdings. After that deadline, any unclaimed Monero will be converted to Bitcoin, with the converted funds being distributed by January 6, 2025, to users who failed to withdraw their assets.
This isn’t Kraken’s first action against Monero in the region. A few months ago, the exchange removed support for the asset in Ireland and Belgium, though it did not provide detailed reasons for these earlier delistings.
Monero’s delisting has sparked commentary from notable figures like blockchain analyst Riccardo Spagni, who suggested that the move could reflect the inability of firms like Chainalysis to effectively track Monero transactions. Spagni noted that if Monero could be reliably traced, regulators might prefer to keep it listed as a surveillance tool rather than delisting it.
Monero’s privacy features have long been a topic of debate. Recently, a leaked video from blockchain analytics firm Chainalysis hinted at potential methods for tracing Monero transactions, raising concerns about the coin’s privacy claims. The now-deleted video fueled discussions within the crypto community about the true extent of Monero’s anonymity.
Market Impact
The announcement has weighed heavily on Monero’s market value, with the digital asset dropping more than 5% to $144, according to data from CryptoSlate.
The price decline reflects a broader downtrend across the cryptocurrency market, as tensions in the Middle East have rattled investor sentiment and driven down the value of Bitcoin and other top digital assets.
Kraken’s delisting of Monero adds to the regulatory challenges faced by privacy coins in Europe, where authorities are increasingly scrutinizing cryptocurrencies for their potential role in money laundering and other illicit activities.
