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0 pointskerkeslager6y ago0 comments

Trivially, cryptocurrency is less private than credit/debit cards, because every transaction is written to the public log. This is true of Bitcoin, Bitcoin Cash, Litecoin, and Ethereum.

Coin tumblers exist for all these currencies. But these a) cost a small fee, and b) are back to centralization, requiring you to trust the tumbler maintainers not to record the transactions.

ZCash[1] is the only cryptocurrency I know of which attempts to actually be private, but the unpopularity of ZCash relative to Bitcoin/Bitcoin Cash/Litecoin/Ethereum shows that most people involved in cryptocurrencies actually don't care about privacy.

[1] https://z.cash/

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topranks6y ago

Monero is a fairly popular privacy coin too.

And while Bitcoin is written to a public ledger, there is a key difference in that you only see “this address sent money to this address.”

That’s still fairly public and you might not want that. But unlike a bank there is nothing linking those addresses to any individual, no name, address and phone number is associated. Plus you can receive funds to a different address every time, so you don’t have to use the same one for each transaction.

It doesn’t mean it’s not public but just to put it in context.

The main issue with crypto is the confirmation time, but 0-conf is probably acceptable in the same way contactless is for small things.

kerkeslagerOP6y ago

> Monero is a fairly popular privacy coin too.

I'll look into that. At first glance some of the privacy claims seem a bit strange, but I haven't looked at the proofs enough to be sure.

> That’s still fairly public and you might not want that. But unlike a bank there is nothing linking those addresses to any individual, no name, address and phone number is associated. Plus you can receive funds to a different address every time, so you don’t have to use the same one for each transaction.

Okay, but trivially this allows you to trace transactions back to institutions (i.e. Coinbase) which are tied into the traditional banking system just like banks--unless you put your coins through a tumbler, coins purchased from an exchange are exactly as private as traditional currency at a bank. Arguably less private, since coin exchanges are under more scrutiny right now than banks.

And unlike banks, if you expose a receiving address for transactions tied to your name, you're exposing every transaction you receive. You're depending on pseudonymity for anonymity, which doesn't work if the only reason you're receiving coins in the first place is a reputation tied to your name. And if a pseudonym can build up enough reputation to receive coins (i.e. Dread Pirate Roberts) then all you have to do to break the anonymity is to tie the pseudonym to the person (we know all the transactions received by Ross Ulbricht because they were received pseudonymously not anonymously, so knowing Dread Pirate Roberts = Ross Ulbricht tells us all the transactions Ross Ulbricht received). In short, pseudonymity is not anonymity.

> The main issue with crypto is the confirmation time, but 0-conf is probably acceptable in the same way contactless is for small things.

There isn't a single "main issue" with crypto--it just has properties, and people only have issues with it if they use crypto for purposes where those properties are unsuitable. If you use Bitcoin for anonymity, your main issue is that Bitcoin isn't anonymous, but that's your main issue, not the main issue with Bitcoin.

I personally have never used cryptocurrency for anything where I cared about waiting for 6 confirmations.

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