Private Transactions Coming to Iota !
Image from google
Straight from the horses mouth
Recently released on the Iota blog was an article about the future of privacy in Iota. The article mentions how Iota could be the "ultimate privacy coin" offering free private transactions. There is still a way to go before it gets there though, as currently the entire ledger is completely transparent.
The fact that the Tangle distributes transaction confirmation among all users, rather than solely to computationally-powerful miners means that any approach using heavy cryptographic computations for creating and verifying private transactions remains impractical, as it would be outside of the capabilities of the majority of lightweight devices on the IOTA network.
Released along side the blog post was a more in depth paper going over the research if you were interested in the details.
Image from google
Methods of privacy
In the paper linked with information about the research the Iota devs released, there are 8 different methods that private transactions could be implemented. They broke these into 3 categories based around the amount of changes that will be required to the code base of Iota to implement, the categories are No changes, Minor or planned changes, and Major changes.
The different methods are explained in more detail, along with pros/cons in the paper, but I'll list them here as a quick reference:
No Changes
- CoinJoin
- CoinShuffle
- Centralized Mixers
Minor/Planned Changes
- CoinSwap
- Blackbytes
- Merge Avoidance
Major Changes
- Zero-Knowledge Proofs
- Ring Signitures
- Others
Image from google
Looking forward
In the next month Iota devs hope to release an Iota Token Mixer, after a successful security audit. Private beta testing for the mixer is already finished according to them. One of the main drawbacks of the current mixer that they state is Iota's lack of enforced timestamps. Once Iota has implemented enforced timestamps, steps can be taken to bring it closer to a trustless system.
This is a very exciting development for Iota because it puts it firmly on the path towards a cryptocurrency with free, private transactions !