$XMR 's situation is a bit delicate—while the global regulatory net is tightening, Monero's advanced privacy technology has instead become its biggest burden.

Looking at it from another perspective: in a world where all windows must be transparent for inspection, you build a perfect opaque fortress. This is the real situation Monero faces today.

The recently approved EU Anti-Money Laundering Regulation stipulates that, starting in 2027, crypto service providers must verify the identity of every customer. This heavy blow directly strikes at the core of privacy coins.

**Regulatory constraints are tightening**

Ironically, Monero's core advantage—completely untraceable transactions—has now become its most primitive crime in the eyes of compliance. The global financial system is accelerating the construction of a transparent regulatory network, while the "financial dark zone" built by Monero is being systematically cleared.

Privacy coins are caught in a war they cannot win. Since 2023, leading exchanges have begun restricting privacy coin trading in Europe. This delisting trend is not just beginning but is the general trend. No regulatory authority will tolerate completely untraceable fund flows—this is not a cyclical policy fluctuation but a hard requirement for the security of the entire financial system.

**Technological prowess is turning into systemic flaws**

Ring signatures, stealth addresses, confidential transactions—these three layers of privacy protection once made Monero praised as the "crown jewel of privacy technology." But now, this technological excellence is transforming into a high-risk label in the eyes of regulators— the more advanced the privacy technology, the less controllable it becomes within a compliant framework.