In the realm of blockchains, safeguarding personal privacy is more crucial than ever. Despite common beliefs, bitcoin is anonymous , this perception is misleading because of the underlying nature of blockchains. fully open and transparent While no specific personal identity is directly tied to a bitcoin address in any public register, every transaction is transparent and traceable, allowing for what's known as blockchain analysis—a method often utilized by government bodies and law enforcement.
Enhancing one's privacy when using bitcoin necessitates significant effort and deliberate action, as privacy isn't the standard setting. This is similarly true for other widely used cryptocurrencies such as Ethereum and Litecoin , among others.
Consequently, privacy-oriented tokens and methods have emerged, becoming increasingly popular. Today, coins like Monero , Zcash , Dash , and PIVX.
We'll be examining the technology that fortifies Zcash, alongside its fork—Zclassic—and its transformation into Bitcoin Private.
Introducing zk-SNARKs
The zk-SNARKs framework is built on the concept of zero-knowledge proofs, which have gained attention following advocacy by well-known ex-CIA contractor Edward Snowden in a tweet post towards the end of last year. Zero-knowledge proofs were initially theorized by a group of MIT researchers during the 1980s.
I\"m with Vitalik. ( https://t.co/xNqGr2Wf6f )
These zero-knowledge proofs could revolutionize confidential transactions. https://t.co/DRCjlkHl4Q— Edward Snowden (@Snowden) December 19, 2017
Put simply, zero-knowledge proofs enable two transacting parties to confirm possession of certain information to each other without disclosing the details. Unlike traditional proof systems requiring complete information sharing, this is akin to storing passwords as plain text.
In a conventional scenario, logging into a server involves the mutual recognition of the password. However, with zero-knowledge proofs, mathematical validation occurs without exposing the password itself. Today, rather than plain text, most websites enhance security through hashed passwords, though threats remain as hashes can be compromised.
Delving deeper into zk-SNARKs necessitates an advanced grasp of complex mathematics, quadratic equations, and what's known as 'moon math'. For those brave enough to explore, Ethereum co-creator Vitalik Buterin made a serious of Medium posts on the subject.
We contrast zk-SNARKs with alternative privacy protocols.
The robustness of zk-SNARKs and Zcash raises questions. Each primary privacy protocol employs unique techniques to conceal transaction data. As previously mentioned, Zcash implements zk-SNARKs.
Monero, its rival, leverages a distinct technology called ring signatures . For PIVX, it uses the zero coin protocol which involves trading PIVX units for anonymized vouchers termed zPIV, which then can be transferred as regular PIVX.
Though opinions vary among advocates of diverse technologies, a notably large consensus of unbiased analysts leans towards zk-SNARKs as the superior option, albeit acknowledging Zcash’s inevitable drawbacks.
Zcash was introduced with a potential Achilles’ heel. Specifically, an initial block development imposed a 'tax' of 20%, automatically directed to the coin's creators, coining the phrase ‘ the founder’s tax “.
Furthermore, the nature of zk-SNARKs brings concerns that if its creators collude or are compromised, the risk exists for an undetectable minting of infinite Zcash tokens due to the current inability to accurately verify the total token count.
Enter Bitcoin Private
To counteract the issues related to the founder's tax and aforementioned ‘trusted setup’ risks, a faction split from Zcash, birthing Zclassic—a nod perhaps to Ethereum Classic.
This fork largely flew under the radar until developers recently spearheaded a fresh branding and rejuvenation project, evolving Zclassic into Bitcoin Private . Accompanying this renaming, Bitcoin Private will integrate original Bitcoin blockchain technology, with enhancements and improvements encompassing zk-SNARKs. In light of this advancement, Zclassic valuations soared, from a single dollar to heights nearing $100. Though Bitcoin Private has not yet debuted, holders of Zclassic and Bitcoin can anticipate receiving shares of Bitcoin Private.
Upon the hard fork's execution, a snapshot capturing all ZCL and BTC ownerships will occur. Bitcoin Private (BTCP) credits will then be awarded at a one-for-one rate to those holding ZCL or BTC in applicable wallets or exchanges. So, owning 15.4 ZCL and 0.1 BTC means receiving 15.5 BTCP.
Among different bitcoin derivatives announcing privacy attributes like Bitcoin Diamond, Bitcoin Private stands out as a unique project integrating zk-SNARKs.
zk-SNARKs Inclusion into Ethereum
According to a post featured on Blockgeeks, as Ethereum advanced into its Metropolis phase, zk-SNARKs was incorporated. However, its application is not universal across Ethereum transactions but remains 'a tool in the toolbox', according to a Zcash blog article.
It would be fascinating to see if Ethereum could broadly deploy such technology, ensuring private transactions across the spectrum. For now, anticipation builds as we await developments from the foundation.
