1) It seems Monero breaks the Travel-Rule / AML perimeter.
- The FATF Travel Rule and national KYC/AML regimes require VASPs (exchanges) to know sender/receiver and screen flows.
- Monero breaks this at scale.
2) Large exchanges are forced to use chain-analytics services (TRM, Chainalysis, etc.) and they can't score XMR beyond crude heuristics.
3) Large exchanges need access to perimeter governance: banks, card networks, licenses, clouds, app stores, and analytics partners to stay compliant.
- For them, potential bad press (e.g. ransomware narratives) is bad risk/reward ratio. One DOJ press release can nuke your bank lines.
- Major exchanges delist privacy coins just before/after key license applications, banking renewals, or geographic expansions.
- For large exchanges, it is high compliance drag, low monetization.
- Regulators probably instructed large exchanges to delist Monero because they need them to derisk and keep tracking everything else.
- The remaining small exchanges can keep tracking Monero inflows/outflows. They are unlikely to delist it as well. Tier-2/3 venues still keep the leakage measurable and surveillable (KYC edges, withdrawal patterns, device/browser telemetry, fiat touchpoints, etc).
- If any of the small exchanges blow up, or lose banks, card networks, licenses, clouds, app stores, and analytics partners, it's much easier to stomach than Binance/Kraken/Coinbase becoming toxic.
- Removing Monero from the default rails also slows adoption.
4) Small exchanges are unlikely to be allowed to delist it.
- Shutting all doors would push flows fully P2P/offshore where telemetry is worse.
- Small exchanges will be left as a controlled-opposition valve. Leaving a sanctioned “privacy outlet” in a few fenced gardens reduces pressure for broader resistance. People think the option still exists, so they don’t escalate.
- Smaller exchanges have looser banking/processing (or crypto-in/crypto-out only) and earn high-margin fees from Monero users and OTC desks.
- They just want to make the privacy choice costly, slow, and niche.
5) Most likely case for the next ~2 years - keep Monero on niche venues but remove fiat pairs in US/EU/UK; crypto-only pairs remain; heavy geofencing; withdrawals throttled.
6) Signals if they decide to delist it from smaller exchanges:
- Fiat pair removals first, then full delists.
- Withdrawal min/max and delays tighten “for compliance”.
- Geofencing expansions (more countries blocked from Monero markets).
- App-store policy tweaks framed as anti-CSAM/AML (collateral damage to privacy wallets).
