Monero (XMR) is the most remarkable cryptocurrency that has ever graced the internet. Not only does it have a proper implementation of cypherpunk privacy features, but its very existence makes madmen and tyrants froth at the mouth, forcing them to reveal themselves as they futilely try to outlaw it, which makes as much sense as outlawing butterflies or gravity. Let's settle this once and for all: is Monero illegal? Monero itself is perfectly legal, but major exchanges were pressured to delist Monero, and the governments of Japan and South Korea have banned Monero because regulators there were afraid it will be used for illicit transactions, money laundering, and tax evasion. Bittrex, Binance, BitBay, CoinCheck, Huobi, Kraken, OKX, and ShapeShift have already delisted Monero, and even the Australian government is on the verge of banning it. There is no real law banning Monero that can be challenged; this tyranny is established through vague rules and veiled threats to CEOs.
How Tyrants Rule
Tyrants always fancied themselves the protectors of their fellow men. They are the loving Big Brother who watches over his bumbling, inept siblings and lovingly corrects them, using tough love if need be. Ancient Greeks knew what they were about. In their vocabulary, “tyrant” meant “master,” and it was not inclusive of any moral qualities — those who wanted to rule over their fellow man were tyrants, regardless of whether their intentions were good. All tyrants think that their intentions are good and will convince themselves and their accomplices of it, going to any extremes and doing as much harm as needed to prove it. All tyrannies begin with the idea of improving or saving the society through some small corrections that need a little bit of force here and just a smidge of violence there that turns into outright slaughter.
In Ancient Rome, where they loathed kings and anyone with their powers, they still had to accept the need for a tyrant that would save them from mortal danger. Rather than have their wimpy Senate drag their feet while “Hannibal is at the gates,” they would issue a decree that installed one man as the ultimate ruler, called “dictator,” until the danger was over. That man’s words became law on the spot, and he could order anyone put to death with impunity. The word “dicta” actually means “a saying” and covers not just military orders but moral issues and lifestyle choices as well. A dictator who said, “I like grapes” would likely have his preferences imposed on the society; anyone who didn’t like grapes could be casually exiled or put to death, creating an environment where nobody dares make a choice without checking with the dictator first.
Rule of Human Law
The problem with a tyrant is that he never knew when to call it quits. There would always be another crisis, which stemmed from nobody daring to make a move without consulting with him first. Worse yet, a tyrant could become detached from reality if his advisors fed him biased or incomplete information that suited the advisors’ agenda, in some instances causing the tyrant to go totally mad. He could still pretend to retain some semblance of sanity and could be capable of issuing some sensible orders, but it was only a matter of time before he was removed from power and replaced by whoever was smart enough to seize the opportunity. If there was nobody to take over, the tyrant would leave a power vacuum that caused internal strife, possibly leading to societal collapse and a civil war that was the only way to cleanse the society of all the insane decrees.
We should by now be well beyond dictators and tyrants thanks to the rule of law. Rather than one person ruling by decree, humanity designed an arduous process of electing politicians who would propose, argue for or against, and vote on laws, which would all be available to the public and could be challenged. Historically speaking, this is a relatively new development; up until the start of the 20th century, most of the world was still ruled by kings issuing decrees and a Senate of wimps affirming them, so it’s no surprise that people are still used to thinking that one person, be it man, woman, or AI, can do the same and shape the society and the lives of anyone in it.
Code As Law
The appearance of the internet put the idea of the rule of law to its ultimate test. The internet is developing so quickly that no legislature can keep up — game-changing internet innovations and startups that build off of each other appear basically every other day. Encryption is one of those innovations and Monero, which builds off of it, is another, and they all exist under the motto “Code Is Law.” First coined by Lawrence Lessig in his 1999 book “Code and Other Laws of Cyberspace,” it means that programmers are the ones that set the rules of engagement online, and that we’re all equal before that law.
Rather than programmers being subject to regulators’ rules and procedures, the internet represents a level playing field where everyone has equal access to power and equal opportunity to wield it to determine and enforce any rules. The internet is free from limitations of any government’s rule-setting process and can invent its own governments, rules, and rule-setting processes, which are as powerful as they are popular. This obviously befuddles governments and frustrates law enforcement agencies used to having absolute control over everything the people in their jurisdiction are doing and using violence and threats of violence to enact their demands.
Not knowing how to control the internet, governments and law enforcement agencies decided to issue tyrannical decrees regarding the internet's most independent features, which is how Monero was made illegal without any actual legislation. In the last few years, this steady creep of unofficial regulation has slowly suppressed Monero out of exchanges without alarming the public or triggering the Streisand effect, a phenomenon where attempts to censor information draw more attention to it.
The eyes of government busybodies were starting to turn to Monero in 2017, when Europol issued the Internet Organized Crime Threat Assessment report, which highlighted the connection between Monero and ransomware. That year saw the appearance of Kirk, Star Trek-themed ransomware that asked for 1,100 Monero as ransom. The report also laments the fact that a European court ruled against data retention in 2014, thwarting comprehensive surveillance of digital activities.
Which Exchanges Delisted Monero?
Crypto exchanges should freely decide which currencies they feature for their users. Those choices should reflect each exchange’s broader philosophy and culture, and by engaging with them, users get access to new markets and new opportunities. But, some bowed down to threats of shutdown, and here’s which exchanges delisted Monero: Bittrex, Binance, BitBay, Coincheck, Huobi, Kraken (for its European users), OKX (for Korean users), ShapeShift, and UpBit, with Coinbase not listing it in the first place. Even though we don’t know of any actual legislation banning Monero in their jurisdictions, how those exchanges explained Monero delisting reveals how the system of tyrannical control works behind the scenes.
Bittrex
On January 1, 2021, Bittrex announced the removal of Monero from its listing, effective January 15. There was no reason listed for the removal save a cryptic “evolving regulatory standards and other compliance issues,” which doesn’t answer why is Monero illegal on Bittrex.
Binance
On February 7, 2024, Binance delisted Monero from its marketplace, citing “discrepancy between Monero’s privacy features and Binance’s compliance requirements.” The delisting came one day after the US Treasury Secretary Janet Yellen publicly called for more strict regulation on cryptocurrencies to plug the gaps in existing laws. That was not likely to happen due to the divided Congress. Binance, whose CEO pleaded guilty to violating financial regulations a few months prior, promised to follow a stricter rule set as part of the deal and delisted Monero without waiting for legislation.
BitBay
On November 25, 2019, BitBay revealed it would delist Monero from its cryptocurrency exchange in February 2020, but the deposits would be blocked as soon as November 29. The stated reason included “consumer protection and reporting practices.”
Coinbase
In 2020, we learned how regulators use veiled threats to make exchanges comply with unofficial rules. In one Decrypt.co article, we read that the Coinbase CEO, Brian Armstrong, was told by a regulator in a private conversation, “We very much don’t think you should do this (referring to listing Monero).” When Brian asked for clarification, he got none. Brian weighed his options and decided it’s better to not butt heads with regulators who have a bone to pick with privacy coins. According to Brian, Coinbase is more than willing to go to court, but every battle there is costly and lengthy. In his opinion, it was in the interest of Coinbase and its clients to not list Monero, allowing the exchange to prepare for the next battle with the regulators, one where there is significantly more at stake.
Coincheck
On May 20, 2018, the Japanese Coincheck cryptocurrency exchange announced that it will delist Monero. There was no explicit reason, but the announcement came a few months after another Japanese exchange, Monex, bought Coincheck, which was unable to recover after a massive hack earlier that year that stole over $500 million. The delisting was seen as an attempt by Monex to repair Coincheck’s damaged reputation and get in good graces with Japanese financial authorities.
Huobi
On September 12, 2022, Huobi announced the delisting of Monero alongside six other privacy cryptocurrencies on September 19; the Monero deposits to the exchange were blocked with the announcement. The stated reason for Monero’s delisting was that it allows “trading concealment.” So, why did Huobi list Monero in the first place? The exchange was initially not present in the US market, but after getting approval from US financial regulators, it decided to preemptively delist Monero to maintain its reputation.
Kraken
In 2024, Kraken started delisting Monero for some European countries, starting with Ireland and Belgium in May and culminating in a blanket ban for customers in the European Economic Area by October. The stated reason was “regulatory changes,” though there is no reference to any specific law or legislation.
Anecdotal evidence from Kraken users indicates that Kraken is still cautious when it comes to Monero. In some cases, Kraken will hold Monero for up to 72 hours if the user buys it with a credit card.
OKX
On September 10, 2019, the Korean branch of the Seychelles-based OKX exchange revealed it will delist Monero for its Korean users due to new Financial Action Task Force (FATF) guidelines that state the sender and receiver of every crypto transaction over $1,000 must be known. FATF are the financial detectives of the G7 countries, and in 2018 they came to the conclusion that there needs to be sustained pressure on exchanges to delist privacy coins, such as Monero. Over 200 countries were expected to implement the same guidelines by mid-2020.
ShapeShift
On November 7, 2020, the Swiss cryptocurrency exchange ShapeShift delisted Monero, with the ShapeShift spokesperson announcing it on Twitter (now called “X”). That came as a surprise, seeing how ShapeShift had a rebellious attitude and was willing to defy regulators to make a point. The exchange’s crypto maverick CEO, Erik Voorhees, declined to comment further on the decision.
UpBit
On September 20, 2019, the exchange from South Korea announced delisting Monero within 10 days. The announcement also referred to the FATF guidelines, which are not laws, but ignoring which can put defiant nations on an international financial blacklist.
Where Is Monero Banned?
Some countries have a blanket ban on cryptocurrencies, while others don’t have any legislation concerning them, making them legal for now. But, some countries are in the middle — they don’t mind cryptocurrencies as long as they don’t involve privacy coins, which are cryptocurrencies that hide transaction details, such as Monero. So, where is Monero banned? In South Korea, Japan, Australia, and Dubai, on the order of their financial authorities that are taking hints from FATF. Why is Monero illegal in those places?
A government will introduce a legislative ban on what harms the population in a way that cannot be controlled. One such ban should be the very last resort, a measure that is only used out of sheer desperation and to prevent the society from unraveling or to “thwart Hannibal.” That still doesn’t answer — why is Monero illegal? Monero transactions cannot be tracked and there is no way to determine who owns how much Monero, which gives people the opportunity to stash away wealth and spend it without their government knowing. The possibility that some of their victims have even a theoretical chance of escaping their domain or having some privacy is what makes tyrants positively apoplectic.
In Dubai, the ban was issued in February 2023 by Virtual Asset Regulatory Authority, the local cryptocurrency regulator, as four rule books. Some of the rules banned the issuance of privacy coins in Dubai, setting heavy fines for those who disobeyed or marketed their services incorrectly. In Japan, the Financial Services Authority was the body that banned Monero after the Coincheck hack. In South Korea, the national regulator called “Financial Services Commission” amended the Special Payments Act in November 2020 with clauses related to cryptocurrencies and mandating KYC procedures, in effect banning Monero as of March 2021.
Monero Illicit Usage
The nature of Monero and its privacy features make it difficult to analyze what it’s being used for. The Europol report I mentioned above is vague about Monero’s uses as well, stating that it is “gaining popularity within the digital underground,” but doesn’t give much detail about it except to connect it to ransomware. Is Monero illegal because of potential or actual illegal usage? The currently prevailing opinion on Monero illicit usage is that it’s used for money laundering, tax evasion, darknet transactions, ransomware payments, and organized crime payments.
In one example of Monero’s illicit usage coming from Norway, a millionaire’s wife was kidnapped in 2018, with the perpetrators leaving behind a ransom letter and asking for roughly $11 million in Monero. Three years later, investigators turned their sights on her husband, Tom Hagen, a Norwegian millionaire who got his riches in the energy business, and accused him of murdering her. The story has all the makings of a Hollywood spy thriller and includes sending coded messages through Bitcoin, fake accounts on Binance and Huobi, and a VPN.
PlasBit’s Fight Against Tyranny
We don’t have a convenient test for tyranny, or at least we didn’t have one until Monero appeared. Now we can confidently state that anyone who wants to ban Monero or is leveraging his or her office or authority to do so is a tyrant, period. The excuse doesn’t matter, because a tyrant will always find a convenient excuse to take the moral high ground, especially when it’s time to think of the children.
I see PlasBit at the forefront of the fight against tyranny through the promotion of Monero and similar cryptocurrencies that make tyrants livid. It’s not about the money; it’s about discussing topics that nobody wants to mention. By doing so, PlasBit fosters a healthy cryptocurrency community where we all innovate and promote human digital rights, in particular the right to privacy. If you like how that sounds, stay tuned for more analyses of cryptocurrency topics.
