What Is Litecoin’s MWEB all about?

Binance had announced that it will not support deposits and withdrawals of litecoin using the MWEB function, stating that any LTC (Litecoin) deposit made to Binance using the MWEB function will not be received or returned which will result in direct loss of funds for the user. This is coming just after some popular south Korean cryptocurrency exchanges including Upbit, Bithumb, Coinone, Korbit, and Gopax, had announced their decision to delist litecoin from their exchanges, citing concerns around country laws and AML (Anti-Money Laundering) rules, with specific mention of the “special financial information act” which states that “exchanges must check whether the transmission records can be verified for digital assets with anonymous transmission technology, and take appropriate measures if anonymous transmission technology is found”.

What is MWEB?

MWEB which is an abbreviation of the word “mimblewimble” a tongue-tying curse from the Harry-porter movie and “Extension Blocks” is the most recent and most significant upgrade on litecoin. The MWEB proposal was set by “Tom Elvis Judesor“ in 2016, and in November 2019 it was introduced as a litecoin improvement proposal. On May 20th 2022, the MWEB upgrade was activated, this upgrade brings in an additional privacy feature to litecoin which will allow users to send and receive cryptocurrencies without sharing how much was sent or received to the public, this new feature will be optional and is being compared to Venmo’s payments application that gives users the options of transacting publicly or privately by deciding whether to make their transaction amounts publicly available to external parties or not. The activation of this upgrade did not go down well with a lot of crypto exchanges and crypto enthusiasts, with some media outlets labelling litecoin as a “dark coin”. It is strongly believed that this upgrade not only brings an additional privacy feature to transactions on litecoin but it also improves the fungibility of litecoin (LTC) and the scalability of its entire network. Because this is a new upgrade it is probably too early to conclude if the claim about it improving the scalability of litecoin’s network is just a mere theory or not, considering the anonymity of transactions this brings and the possibility of exchanges not being able to track how much is being sent or received and what addresses are involved in transactions using the MWEB function, we should expect responses from more cryptocurrency exchanges in the coming days, while the response of exchanges to this upgrade are expected to be centered around technical or regulatory concerns, those who do not care so much about this regulatory concerns and are interested in keeping their transaction details private will consider this a more viable option and whether this upgrade indeed makes litecoin the most fungible, cash-like, cryptocurrency in the space is left for time to reveal.