Bitcoin's privacy features have come under fire from critics since early 2013. 

While the protocol remains technically robust and mathematically secure, a loophole allows blockchain analysts and cryptographers to link transactional behavior to users, leading to a Bitcoin term as "pseudonym"

But a seasoned developer thinks the problem can be resolved using an integrated framework in 2013, a then launched protocol called CoinSwap invented by Greg Maxwell of Blockstream. 

Improve Bitcoin privacy 

Chris Belcher, a   freelance developer whose Github story shows hundreds of validations across various Bitcoin- centric apps , released his   new implementation proposal   for CoinSwap last week. 

Belcher's approach builds on CoinSwap's earlier solution - that of using a "swap" method to transact. At the time, the framework was based on carrying out transactions via an intermediate wallet instead of a direct transfer, which has the effect of "masking" the addresses of the wallet. 

But the protocol has proven difficult to implement and has never worked, notes Belcher. A    relevant  Bitcointalk  thread   has not shown activity since 2016, which means that the project has indeed been abandoned. 

However, the Bitcoin developer noted that CoinSwap is "very promising" and is the "next step for the confidentiality of chain bitcoins". 

Belcher, in its implementation, proposes to create a “liquidity market” similar to JoinMarket and CoinJoin. He explains:

“We can get a little more anonymity by using the 2-on-3 multi-sig with a false third public key. For much greater anonymity, we can use 2-part ECDSA to create 2-by-2 multi-signature addresses that look like standard single-signature addresses [2]. "

Work

Belcher uses a multi-stakeholder mechanism to avoid two-person transactions, so Bitcoins moved from a user's wallet will be “routed” through several other user wallets before reaching the recipient. All intermediaries will act as "market makers", only knowing the previous and next Bitcoin addresses . 

The above approach helps boost Bitcoin's fungibility , making it a "better form of money," according to Belcher. He notes that the implementation could also be used as a " Bitcoin mixing app ", but the wallet providers could also implement the system and increase the privacy of their users. 

It should be noted that the approach is very technical and more complex than the above explanations do not seem to present several problems along the way to guarantee their significance. 

Some issues include malicious users "blocking" a user's transactions "indefinitely" on the CoinSwap protocol. "Loyalty obligations" can help solve this particular problem, Belcher explained in depth in   previous Github publications  .  

Meanwhile; Belcher noted that the approach may resemble the Lightning network but presents several improvements over the latter. One presents better liquidity for users, Belcher declaring "it's hard to imagine that the Lightning network will ever be reliable" routes a transfer of 200 Bitcoin to any node of the Bitcoin protocol .