The Dubai Financial Services Authority recently introduced new regulations, fully banning privacy coin-related activities within the Dubai International Financial Centre. The ban covers trading, promotion, and derivatives operations of privacy coins, with mainstream privacy coins like XMR included in the restrictions.

The official reason for the ban is quite straightforward: the technical properties of privacy coins are fundamentally at odds with anti-money laundering and international sanctions compliance requirements, making it impossible to meet the standards of global mainstream financial regulation. In other words, the anonymity features of privacy coins are precisely their "original sin" in strictly regulated regions.

Notably, the new policy also differentiates within the stablecoin ecosystem. Regulatory authorities only recognize "on-chain fiat-backed tokens" that are backed by real fiat currency or high-quality liquid assets, while stablecoins relying on algorithmic mechanisms to adjust supply are excluded from recognition and downgraded to ordinary cryptocurrencies. This means a clear divergence in regulatory treatment between these two types of stablecoins.

From a technical perspective, XMR faces short-term pressure. Market observers generally believe that such bans will have a tangible impact on privacy coins, especially by squeezing liquidity in major financial centers. Different institutions have varying opinions on the subsequent trend, but there is widespread attention on whether support can be found around the 560 level.

This policy adjustment reflects the ongoing tightening of global regulation on privacy coins. Investors holding privacy coins should closely monitor regulatory developments worldwide and assess their risk exposure in a timely manner.