Trezor to end privacy-enhancing coinjoin feature as Wasabi Wallet steps back

Crypto
hardware
wallet
manufacturer
Trezor
announced
today
the
discontinuation
of
the
coinjoin
feature
in
its
Trezor
Suite.
The
service,
provided
in
partnership
with
zkSNACKs,
the
developer
of
the
Wasabi
Wallet,
will
cease
by
June.
Despite
the
shutdown,
Trezor
assures
users
that
funds
within
Coinjoin
accounts
will
remain
accessible.

Coinjoin
in
Trezor
will
be
shut
down
by
1st
June
2024.

We
deeply
value
the
privacy
of
our
users,
and
it
is
with
great
regret
that
we
must
announce
the
discontinuation
of
the
Coinjoin
feature
for
Trezor
Suite
by
1st
June
latest,
as
our
partner
will
no
longer
provide
this
service.…

https://t.co/KgyWIdtV6v

—
Trezor
(@Trezor)

May
2,
2024

Coinjoin
is
a
privacy
tool
for
Bitcoin
transactions,
allowing
users
to
obscure
the
origins
and
destinations
of
their
funds.
Trezor
was
the
first
hardware
wallet
to
embrace
coinjoin
transactions.
It
integrated
coinjoin
feature
into
the
Trezor
Model
T
in
April
last
year
and
extended
the
implementation
to
the
Trezor
Model
One
later
in
August.

zkSNACKs,
in
a
recent

blog
post,
expressed
the
decision
to
end
its
coinjoin
coordination
service
was
made
with
a
“heavy
heart”
and
a
need
for
“legal
clarity.”
The
company
said
Wasabi
Wallet
will
still
offer
robust
privacy
features,
such
as
client-side
filtering
and
Tor
integration,
even
without
coinjoin.

The
move
follows
zkSNACKs’
decision
to
block
US
citizens
and
residents
from
accessing
its
services,
including
Wasabi
Wallet,
due
to
recent
regulatory
pressures.
This
prohibition
extends
to
related
websites
and
services,
with
IP
address
blocking
already
in
effect.

Non-custodial
crypto
service
providers
face
legal
showdown

Phoenix,
another
crypto
wallet
provider,
recently
announced
it
would
exit
the
US
market
due
to
ongoing
regulatory
uncertainties.
Users
are
advised
to
close
their
channels
and
transfer
their
funds
before
access
is
terminated
on
May
5,
2024.

“Recent
announcements
from
U.S.
authorities
cast
a
doubt
on
whether
self-custodial
wallet
providers,
Lightning
service
providers,
or
even
Lightning
nodes
could
be
considered
Money
Services
Businesses
and
be
regulated
as
such,”
Acinq,
the
Bitcoin
company behind
Phoenix
explained
its
decision.

The
exodus
follows
the
SEC’s
recent
crackdown
on
non-custodial
wallet
provider
Samourai
Wallet
and
growing
scrutiny
over
MetaMask.
The
SEC
reportedly
issued
a
Wells
Notice
to
Consensys,
MetaMask’s
parent
company.
This
notice
serves
as
a
preliminary
warning
that
the
SEC
is
considering
legal
action.

In
response,
Consensys
filed
a
lawsuit
against
the
SEC,
choosing
to
confront
the
regulatory
challenges
head-on
rather
than
await
further
SEC
actions.
Previously,
Uniswap
Labs,
the
team
behind
the
decentralized
exchange
Uniswap,
also
received
a
Wells
Notice
from
the
securities
agency.