Why so many coins? Examining the demand for privacy-preserving cryptocurrencies

Gbenga Ibikunle; Vito Mollica; Qiao Sun

doi:10.1016/j.bar.2025.101637

Why so many coins? Examining the demand for privacy-preserving cryptocurrencies

Gbenga Ibikunle^*, Vito Mollica, Qiao Sun

^*Corresponding author for this work

Research output: Contribution to journal › Article › peer-review

Abstract

We investigate the impact of anonymity and privacy-preservation on cryptocurrency use. We find that privacy coins, which deploy advanced privacy-preserving technologies to enhance trader anonymity, experience a relative increase in usage compared to non-privacy coins following regulatory interventions aimed at countering illegal activities in cryptocurrency trading and use. However, the adoption of privacy coins decreases relative to non-privacy coins after the introduction of regulations restricting the use of privacy-preserving protocols. These findings underscore the significance of privacy as a driving factor in cryptocurrency adoption.

Original language	English
Article number	101637
Pages (from-to)	1-19
Number of pages	19
Journal	British Accounting Review
Early online date	18 Mar 2025
DOIs	https://doi.org/10.1016/j.bar.2025.101637
Publication status	E-pub ahead of print - 18 Mar 2025

Keywords / Materials (for Non-textual outputs)

cryptocurrency
financial regulation
privacy
technology protocols

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10.1016/j.bar.2025.101637Licence: Creative Commons: Attribution (CC-BY)

CorrectedProofIbikunleEtal2025BARWhySoManyCoinsFinal published version, 2 MBLicence: Creative Commons: Attribution (CC-BY)

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title = "Why so many coins? Examining the demand for privacy-preserving cryptocurrencies",

abstract = "We investigate the impact of anonymity and privacy-preservation on cryptocurrency use. We find that privacy coins, which deploy advanced privacy-preserving technologies to enhance trader anonymity, experience a relative increase in usage compared to non-privacy coins following regulatory interventions aimed at countering illegal activities in cryptocurrency trading and use. However, the adoption of privacy coins decreases relative to non-privacy coins after the introduction of regulations restricting the use of privacy-preserving protocols. These findings underscore the significance of privacy as a driving factor in cryptocurrency adoption.",

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AU - Sun, Qiao

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AB - We investigate the impact of anonymity and privacy-preservation on cryptocurrency use. We find that privacy coins, which deploy advanced privacy-preserving technologies to enhance trader anonymity, experience a relative increase in usage compared to non-privacy coins following regulatory interventions aimed at countering illegal activities in cryptocurrency trading and use. However, the adoption of privacy coins decreases relative to non-privacy coins after the introduction of regulations restricting the use of privacy-preserving protocols. These findings underscore the significance of privacy as a driving factor in cryptocurrency adoption.

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KW - financial regulation

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KW - technology protocols

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Why so many coins? Examining the demand for privacy-preserving cryptocurrencies

Abstract

Keywords / Materials (for Non-textual outputs)

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