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Who cares about privacy? Not crypto users say Coin Metrics.

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Crypto Business World Follow

INDIA

Sep, 24 2020

Sep, 24 2020

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The majority of crypto transactions do not include privacy tokens. Most traders choose to move funds transparently rather than privately.

Crypto analytics firm Coin Metrics’ Sept. 1 State of the Network has released a report. It states that the combined daily transactions of three privacy coins, Zcash (ZEC), Monero (XMR), and Grin (GRIN), equated to only 6% that of Bitcoin (BTC). This was despite the coins offering substantially more privacy. 


User apathy towards privacy is probably the biggest shortcoming of the current anonymous transaction systems.

 

Besides, crypto traders may not be taking advantage of the privacy features their tokens have. ZEC’s includes trustless zero-knowledge proof systems. This is also known as zk-SNARKs. These allow for transactions that do not reveal anything. They do not disclose who transacts or what amounts are exchanged. But the report stated that fewer than 2% of ZEC transactions were shielded and fully-private.

 

Cryptocurrencies have to go back to their original privacy-oriented ethos to survive. If not, the reported stated, the idea of anonymous transactions systems could fade away. There could be an increased risk in cryptocurrency and other digital currency.

 

But it is not always that easy to use privacy coins. Many Australian exchanges have begun to delist privacy coins like Monero, citing government regulations.

 

The increasing privacy of BTC through services like CoinJoin may hold the key to cryptos salvation. CoinJoin has seen increased activity, with providers including the privacy-focused Wasabi Wallet and Samourai Wallets non-custodial Bitcoin mixer, Whirlpool. Users set a new record in August for the number of Bitcoin mixed monthly at 2,429 BTC, or almost $30 million.

 

Monero and Grin each have unique privacy features. GRIN is an implementation of the Mimblewimble protocol. This employs confidential transactions to obfuscate transaction amounts and makes use of aggregated transactions. This will help to prevent the linking of native transaction inputs and outputs.

 

XMR uses ring signatures. These aggregate a crypto senders real coins with a set of decoys. These are picked semi-randomly from other points in the blockchain. On Aug. 6, the token experienced its most massive increase in daily hash rate, spiking to 2.2 GH/s.

 

Cryptocurrency-related crimes during the first half of 2020 have been massive. They have already accounted for $1.4 billion worth in thefts, hack, and fraud.

 


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