Swan Bitcoin, a bitcoin exchange platform, announced recently that it would terminate accounts of users directly interacting with mixing services. The company explained that this was due to the pressure from banking institutions after the Financial Crimes Enforcement Network (FinCEN) presented a proposal to increase the bookkeeping requirements on these transactions.
Swan Bitcoin Announces New Restrictive Policies Regarding Mixing Services
Swan Bitcoin, a California-based Bitcoin services platform, recently announced a change in its policies regarding mixing services. The company sent a letter to its customers stating that from now on, accounts that interact directly with transactions coming from or going to coin mixing services risk being terminated.
The company explained that this change had to do with the pressures that its banking partners had been exerting due to the introduction of a Financial Crimes Enforcement Network (FinCEN) proposed rule that seeks to establish new responsibilities on institutions facilitating transactions that include mixing services.
On the issue, Yan Pritzker, co-founder and CTO of Swan Bitcoin, stated that while the company itself has an open policy for allowing coin mixing as a privacy service, there is no way of on-ramping customers with fiat without connecting to qualified custodians and banks. Instead of doing investigative work the company prefers to avoid risks entirely.
Game theoretically, this behavior is expected and obvious. Why should a bank have to do extra work to prove innocence when the government has been telling them for years that they don’t want to see mixing?
A Community Enraged
Even after Pritzker’s statements, some members of the crypto community rejected Swan’s new policies, stating that these were directly opposed to the ethos of the exchange.
Samourai Wallet, one of the wallets that features mixing services, heavily criticized Swan Bitcoin’s actions, declaring that the exchange was acting like the enforcer of a proposal that was not even law yet and inviting users to close their accounts or force the exchange to terminate them by interacting with mixing services.
Samourai Wallet stressed:
It’s still a proposal you lame f*cking p*ssies. Instead of mounting a defense you preemptively comply? Absolute losers.
Vlad Costea, host of the Bitcoin Takeover podcast, also blasted Swan Bitcoin’s actions, explaining these were “dystopian” and sought to establish an anti-Bitcoin compliance culture. “As a European, I don’t have access to Swan. But if I did, I’d stop using the service ASAP,” he concluded.
What do you think about Swan Bitcoin’s new account termination policies? Tell us in the comments section below.