Does Bitcoin Really provide anonymity and privacy? The Solution is Privacy Coins
Does Bitcoin Really provide anonymity and privacy? The Solution is Privacy Coins

By ModernEuler | Moderncrypto | 7 Nov 2019


  • What is Bitcoin?

Bitcoin is, according to Nakamoto's white paper, a purely peer-to-peer version of electronic Cash, would allow online payments to be sent directly from one party to another without going through a financial institution.

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Privacy features of Bitcoin are explained in white paper.

According to Nakamoto, the traditional banking model achieves a level of privacy by limiting access to information to the parties involved and the trusted third party. ... This is done in Bitcoin by keeping public keys anonymous. The public can see that someone is sending an amount to someone else, but without information linking the transaction to anyone. This is similar to the level of information released by stock exchanges, where the time and size of individual trades, the "tape", is made public, but without telling who the parties were.

anonymous transactions and privacy ile ilgili görsel sonucu

So, transactions are public, not  anonymous and they are written down on a public ledger (known as blockchain),  but the parties of this transactions are not open to public thanks to private keys. All Bitcoin transactions are recorded on an open public ledger showing that A address sent B address X amount of BTC. Does this provide privacy?

No,bitcoin transactions provides perhaps the most transparent payment history of any financial system to date. While there are no official names directly attached to crypto wallets,your identity can be discovered easily by analyzing these transactions on the blockchain.

For example, Bitcoin addresses are public most of the time because we put it on our posts, blogs, on even Twitter. Then Bitcoin address is no longer private and you can be identified by looking at the transactions. Your total BTC may even be identified through some calculations. Another case,  exchanges that gather KYC information. They link your ID's to your Bitcoin wallet address. 

 

COINS THAT PROVIDE REAL ANONYMITY AND PRIVACY: PRIVACY COINS

Privacy coins are solution to Bitcoin's anonymity problem. They provide true anonymity and privacy to its users . Unlike Bitcoin Blockchain, these coins hide information about senders and receivers during transactions so that your transactions can not be traceble. 

If you value their privacy, privacy coins are for you. 

Bytecoin (BCN), Monero (XMR), Dash, Zcash (ZEC), Verge (XVG) are largest privacy coins. see the full list of privacy coins here at cryptoslate

 

 

PRIVACY COINS ile ilgili görsel sonucu

Bytecoin (BCN)

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The first private and untraceable cryptocurrency ever to be created in 2012 is called Bytecoin (BCN). It is a predecessor to all (Monero, Dash, Zcash etc. ) Bytecoin algorithms don't allow other users to know your wallet balance, to whom you send money and where you receive your funds from. It is trading at $0.00046. Get free Bytecoin (BCN)

MONERO (XMR)

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Although Monero is a fork of Bytecoin in 2014, it is the largest privacy coin by $1.1 billion market cap. It is an open-source crypto. It focuses is on fungibility, privacy, and decentralization. 

It is trading at $65.  Get free MONERO (XMR)

 

DASH 

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Dash is the second largest privacy coin with its $617 M. market cap. Dash has made great progress in Venezuela recently.

It is trading at $73. Get free DASH 

Zcash (ZEC)

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Zcash was released in 2016 October. Zcash is the third-largest privacy coin with its $305 M. market cap. It provides an option to its users to shielded address to in order to keep transactions private which enables its transaction completely anonymous. People like this feature a lot and mine it. 

It is now trading at $39. Get free Zcash (ZEC)

 

Verge (XVG)

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Verge (XVG) is the sixth largest privacy coin with its $64 M. market cap.It is trading at $0.000401.  Get free Verge (XVG)

 

CONTROVERSIES

Privacy coins delighted libertarians and but frustrated law enforcement agencies.That's why some exchanges delist the privacy coins. For example,in August, Coinbase UK dropped support for Zcash. On Sept. 10, OKEx Korea said it’s delisting five coins -- Monero, Dash, Zcash, ZCache, Horizon and Super Bitcoin -- citing the Financial Action Task Force rules outlined in June. (Saurce: Bloomberg.com)

 

Thanks for reading. I hope you’ve found it helpful.

 

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ModernEuler
ModernEuler

A crypto and blockchain enthusiast and blogger. Writing about Crypto and trading since 2017. I cover the topics including crypto news, trading suggestions, chart analysis, etc. Follow me on Twitter @cryprostream


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