A Lesson in anonymity: Bitcoin, Dash, Monero and Zcash

in #money7 years ago



In the beginning there was Bitcoin, an open source digital currency that allows us to make anonymous payments or transactions almost instantly and through an immutable public ledger known as the blockchain, that keeps track of every transaction ever made.

This is probably the way most people would describe Bitcoin, on a basic level. The problem is that these two concepts are contradictory; since every transaction is recorded on the blockchain, including sender, receiver and amount, Bitcoin can be the exact opposite of anonymous.

What makes us believe that bitcoin is anonymous is the fact that wallets are not connected to our names. They're simply a bunch of random characters that don’t mean anything, but our names are the exact same thing a bunch of characters that are used to identify ourselves, so in Bitcoin we give ourselves a complicated nickname or several complicated nicknames, making bitcoin a Pseudonymous cryptocurrency.

Our nicknames or wallet addresses can be, in most cases, easily traced back to the user, through IP addresses, transaction history, used service providers and so on. Specialists have also been known to be able to determine a lot about someone's identity by their transaction patterns, such as time zone, for example.

Tumblers or Mixers were introduced to deal with this traceability problem. A Mixer is basically a collective of people coming together, putting their coins on the table, shuffling them and then each individual takes back his specific amount from the random coin pile. Users can also set options like time delay in the mixture.

Tumblers are considered a “band aid over a stab wound” in the context of bitcoin, since they can still be traced trough careful analysis, and it requires users to trust their BTC with a third party service, which can steal your coins at any given time.

Mixers will also increase the possibility of a coin not being fungible, since a receiver can check that a coin came from a mixer, which may have coins with a record of criminal activity.


In 2014, Darkcoin was born later to be rebranded as DASH (Digital Cash). Darkcoin was created a privacy centric cryptocurrency that allows users to pre-mix their coins by combining identical inputes from multiple senders into a single transaction that has serveral outputs.

This system was known as Darksend and was recently rebranded to PrivateSend, it is currently a built-in feature in the DASH wallet. This is a step-up from third party coin-mixing services, but it still allows us to determine the receivers of the transactions, which leaves room for expert analysis.


In the same year DASH was created, Monero also saw light for the first time as a Cryptonote cryptocurrency, focused on providing greater privacy.
Monero uses a ring signature system to provide anonymous transactions. In a ring signature setting, a group of users have a set of keys that can confirm a transaction without revealing which user made it.

Users can set the how many mixins they want for their transaction, which makes it easier or harder to trace. The problem with the [Monero}(http://monero.org/) setting is that the majority of transactions occur with only one mixin, meaning that mixed transactions can still be traced. [Monero}(http://monero.org/) developers are currently looking to implement a minimum 2 (two) mixin solution, to ensure the currency can provide greater privacy.


ZCash is different. Developed from Zerocoin, which was to be an alternative privacy system built on top of Bitcoin, ZCash will be a Proof of Work cryptocurrency with no transaction records whatsoever.

Users will be able to make a transaction that will be completely encrypted on the blockchain.
ZCash uses zero knowledge SNARKS to make sure that despite all the information being encrypted, it is still correct and no double spending would be possible. The only information available on the ZCash blockchain will be the time on which transactions take place.

No sender or receiver address and no amounts displayed on the blockchain, makes ZCash the first truly anonymous cryptocurrency out there.

https://z.cash/ | formerly http://zerocoin.org/

Reply and vote for your favourite anonymity coin below!!!



dash Dash fans reply and vote here!

I bought my first Dash around 5-6 bucks and mine Dash and Start with Genesis. Start has been around for a while but is recently seeming to take off more. www.StartCOIN.org

Can we get an anonymous steemit option? :)

that would be good...currently I can see how much money you have ....muhahahahah!

Z-Cash because it's the only anonymous coin.

Others are just pray-and-hold coins.

Though Dash is a pretty fast crypto!

Zcash and Dash are my preferrences, hedged on Dash during Brexit.

Monero Ethereum and Dash are DEFINITELY not just pray and hold coins. Siacoin and Lisk also have a lot of potential. Most coins are just fighting for their specific niche of the market.

I meant if you're engaging in illegal activity/want to reamin private.

I saw pray and hold and got a little defensive haha I thought Monero was pretty private.

So what about Komodo or the new stash ICO? Both buiilt of Zcash.

monero Monero fans reply and vote here!

I bought some Monero at just under a dollar. I like to trade currencies using it instead of bitcoin. (I've been turning all my BTC profits from margin trading into NXT, ETH and XMR.

Monero has had a minimum mixin of two since March of this year. The minimum mixin will increase to four in a future scheduled hard fork to further ensure privacy.

zcash Zcash fans reply and vote here!

Crypto based on zerocoin seems to be the most sophisticated anonymous currencies so far. As far as I know there are three coins based on zerocoin so far: Zcash , Zcoin and Zoin (they are on crypomarketcap.com). Since Zcash doesnt have an official GUI yet, I havent used it. But I tried Zcoin, however it seems really buggy, and I'm not sure I can recommend it.
Also, there are differences between Zcash and Zcoin - Zcash hides the amount sent, but Zcoin does not.

Don't know much about zcash, will have to look into it more.

ZCash! The anonymity of the transactions is in the design basis. It really fulfills its objective. The only problem is in the scalability of its performance.

Thanks for the info! , @thecryptodrive

Zcash bitchez! Anonymity = freedom!

BTW, my vote is for Monero...

Just because I own some... Zcash looks the most anonymous.

nice breakdown of a few of the altcoins!

A concise explanation. Thank you :)

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