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What is an anonymous cryptocurrency

November 28, 2018 02:02:51

Bitseven.com - Bitcoin was created as an anonymous currency, which will be managed by users themselves. And until it gained wide popularity, it was believed that Bitcoin is absolutely safe, anonymous and not controlled by anyone. However, over time it became clear that this is not so. The network has information that the owner of a Bitcoin wallet can be easily identified, found out his real name, address and other personal information. Stories began to emerge about how law enforcement detained some users who used Bitcoin for criminal purposes. Subsequently, this led to the fact that digital currencies with increased anonymity began to appear on the market.


Anonymous cryptocurrencies

Such cryptocurrencies are peer-to-peer payment systems that have their own internal coin. The peculiarity of such assets is that they use of cryptographic protocols to complicate or even make it impossible to track intra-network information, in order to ensure maximum anonymity of transactions. Today, there are already cryptocurrencies on the market that fully meet these requirements, and new ones are constantly appearing.


Monero

This cryptocurrency is considered one of the best in terms of anonymity. Monero network is confidential, it is impossible to track wallet numbers, balances and transaction amounts. This is confirmed by the fact that even law enforcement agencies can not identify at least one user in the darknet, although this network is constantly carried out a huge number of transactions using Monero.


In order to preserve confidentiality, the Monero blockchain uses cryptographic algorithms RingCT, Kovri and Stealth. The disadvantages of cryptocurrencies include only slightly increased complexity of use, and increased transaction sizes, compared to other cryptocurrencies.


Dash

The coin is called a pioneer in the direction of increased anonymity. For the first time this cryptocurrency was launched in January 2014, and then it was called XCoin, and a month later it was renamed Darkcoin. Many users associated this name with darknet and crime, so in March 2015 it was renamed to Dash.


Thanks PrivateSend in the blockchain Dash you can carry out confidential transactions, users are able to anonymize their own funds before use too. This anonymity is achieved thanks to a two-level blockchain, which also contains masternodes. To conduct an anonymous transaction, the user must contact with the masternode, which, having received requests from several users, mixes their funds and sends them in the right direction.



ZCash

It is an anonymous payment system that uses a virtual currency based on The zerocoin and ZeroCash protocols, while privacy is ensured by the ZK-SNARK zero-knowledge proof Protocol. The Protocol allows you to verify the authenticity of the transaction, while maintaining the anonymity of contractors and hiding the amount of transactions. In the public space there are only time stamps, and the coins themselves can be interchanged and it is impossible to track their movements.

However, ZCash allows you to make open transfers using public accounts, and if the recipient uses an anonymous account, the balance information will remain unavailable. ZCash also offers cheaper fees for public transactions.


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