LocalMonero, a peer-to-peer trading platform for the privacy-focused cryptocurrency Monero, has made the decision to shut down its services immediately. In a recent announcement, the exchange informed its users that new signups and advertisement postings for Monero trades would be disabled, and starting from May 14, the platform will no longer support trading of the privacy-focused cryptocurrency. The company cited a combination of internal and external factors for its decision without specifying the exact reasons behind the closure. The website will be taken down completely on November 7, and users are urged to reclaim any funds from their wallets before that date to avoid potential loss.
Established in 2017 as the Monero equivalent of LocalBitcoins, LocalMonero acknowledged the growth and maturation of the Monero ecosystem over the years. The platform’s team expressed confidence in Monero’s future, pointing to the imminent launch of decentralized exchanges such as Haveno and Serai, as well as the recently announced privacy update called Full-Chain Membership Proofs (FCMPs). Although LocalMonero is closing its doors, they believe that Monero will continue to thrive, with or without their platform. This closure is seen by some as another setback for privacy coins and protocols, following Kraken’s termination of support for Monero and recent legal action against Tornado Cash.
Privacy advocate “Seth For Privacy” expressed sadness about the closure of LocalMonero, emphasizing the platform’s significance as a cornerstone of the no-KYC Monero ecosystem. He noted that there is currently no direct fiat-to-XMR alternative available, underscoring the platform’s importance to the Monero community. While LocalMonero did not provide a specific reason for its closure, users have been left to speculate about the underlying causes. As platforms dealing with Monero face challenges, the centralization aspects and regulatory pressures play a role in their operations.
In recent months, global finance regulators have increased scrutiny on privacy coins and services. The co-founders of Samourai Wallet, a cryptocurrency mixer, were arrested on charges of money laundering by the U.S. Justice Department and other agencies. Samourai Wallet CEO Keonne Rodriguez and chief technology officer William Hill are facing allegations of conspiracy to commit money laundering and conspiracy to operate an unlicensed money transmitting business. Other privacy services such as Wasabi CoinJoin and Trezor Coinjoin have also shuttered recently as the crackdown on privacy intensified.
The U.S. government has been cracking down on crypto-mixing services, with Tornado Cash being added to the Specially Designated Nationals list, effectively prohibiting Americans from using the mixer. Roman Storm, co-founder of Tornado Cash, pleaded not guilty to all charges and faces travel restrictions following his arrest. Similarly, the founder of Bitcoin Fog, a $400 million crypto-mixing service, was convicted of money laundering. All these actions highlight the increasing regulatory pressure on privacy-focused services in the cryptocurrency space.
