Most privacy coins aren’t as private as you think

Privacy coins are meant to hide your identity and keep your wallet anonymous while making transactions. This is what makes them stand out since your financial information and activities are hidden from the public. However, when this aspect is stripped away and most privacy coins aren’t as private as people are made to understand and this makes them merely become altcoins and leave their users at risk of public exposure. Recent reports have questioned these privacy features by coins such as Monero and Zcash.

The Zcash funds are either public or private. The transparent value is similar to bitcoin together with its privacy features. The private amount includes a paying key which states the destination to which the funds can be transferred. The paying key is connected to a spending key that spends notes sent to the address. However, the transactions are not shielded by default. Thus 85% are public.

Additionally, when most private transactions in Zcash are not private by default, it makes those who enable this feature look suspicious to agencies such as the National Security Agency (NSA). According to Edward Snowden, the agency has been spying on Bitcoin users using spy tools and collecting unwarranted data. An example is when Ross Ulbricht from Silk Road was prosecuted on the basis of the data collected by the agency.

While Monero offers a stealth address to every user and bounces hundreds of transaction together, it has become the most used coin in the dark web in executing crypto jacking attacks to unsuspecting users. Monero was established in 2014 with an aim to maximize anonymity; however, according to the Wired Notes report in 2017, the enhanced anonymity feature has worked to the advantage of malicious individuals in the dark web.

Moreover, according to Monero’s Riccardo Spagni, currently, the aspect of privacy in cryptocurrency can only be achieved to a certain point, which is perhaps not good enough to escape the spying eyes of a determined agency such as the NSA, which has the resources and determination. This also confirms that most privacy coins aren’t as private as they seem.

Do you think it is possible to achieve 100% anonymity in privacy coin transactions? If so, what would it take to accomplish this?

Share your thoughts in the comments section below.

Ken Gichiri

Ken is a cryptocurrency lover and very active in cryptocurrency mining. With freelancing experience in contributing to many leading blogs both financial and cryptocurrency sites, Ken is dedicated to bringing the latest and educative content to his readers

One thought on “Most privacy coins aren’t as private as you think

  • April 6, 2018 at 4:58 am
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    This is what is missing The Introduction of a Non-Distributed Singular Ledger and The Removal of Third Parties

    Satoshi Nakamoto had to release Bitcoin as a Distributed Ledger because it needed to be since at the time of its creation there was no Decentralized Virtual Machine created to be able to store and secure the Ledger in. For this reason there is a Consensus Mechanism to validate the transactions that partake in the Distributed Ledger. After the creation of Ethereum or the First Decentralized Virtual Machine the concept of a Distributed Ledger was not to be needed anymore as a Secured Environment was finally created to be able to store the Ledger in. It can be said that Ethereum blindly followed the use of the Distributed Ledger and any/all Blockchains using a distributed ledger after the creation of a Decentralized Virtual Machine is also blindly following this concept. For this reason no Cryptocurrency has been able to achieve true privacy not even any current Privacy Coins out at the moment, whether it is Monero, DeepOnion or any others as they are required to mix the transactions in with others in order to be able to hide as best as possible who the true sender is. The reason being that transactions that partake in the blockchain have to be publicly broadcasted in order for users to ensure that the third parties presented in a Distributed Ledger are uploading the validated ledger in which was agreed upon and that the ledger has not been tampered or altered by these Third Parties even if they are “trustless”.

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