The cryptocurrency industry is aware of the need for privacy applications, as private businesses are planning to track pseudo-anonymous Bitcoin (BTC). That necessity has created waves of altcoins each expecting to surpass the rest.
This, however, comes with other big implications besides the palmy market cap. A community which lacks primal privacy apertures will lunge into an Orwellian future where each financial transaction is linked to any personal data.
Now, two parties have come out to provide fruitful solutions to these particular hurdles. The privacy technology analysis of Monero and Zcash will finally impart itself to an improved orientation of which rising cryptoassets may be worth reckoning.
A piece by BTCManager, the first of this 3-part series will handle the defects of BTC’s privacy feature and the third-party solutions, such as tumblers.
According to 2018 reports from Elliptic and Chainalysis, it very easy to match BTC operations with customers. The pioneer crypto can be traced comparatively quickly through the observation of its public ledger even if it is done through mining pools, wallet transaction or gambling websites.
In 2013, a group of senior researchers from George Mason University, San Diego and University of California reported that although the ownership of BTC is faceless, its flow is clearly visible worldwide.
Philip Gradwell from Chainalysis said that this can be attained by clearly grouping together transactions. He revealed:
“BTC addresses do not have IP addresses associated with them, so we cluster based on the protocol.”
Similarly, the same procedure was employed to clearly see the movement of stablecoin Tether together with modest-volume coins.