Those familiar with the cryptocurrency landscape are probably aware that there are a number of tokens – secret secret coins – valued for the anonymity they provide to users. Unlike, which hides a user's identity but has a public ledger and a transparent portfolio, alt currencies such as (XMR), (ZEC) and (DASH), securely mask the identity of the sender and the recipient.
Although they are useful for people who legitimately do not want to make their financial transactions public, these coins are also noteworthy for their use by individuals such as terrorists, drug dealers and other criminals. How such regulators of the government continue to work on ways to smooth the effectiveness of these cryptocurrencies, even if not always with great success.
But even with their vaunted clandestine skills, so that a currency for privacy is really effective, it must keep its promise: true privacy. And it has not always been this way. Recently, the Monero developers have revealed that there is a big problem in the alt-currency wallet software, which allows attackers to drain XMR from the bags at the cost of certain transaction fees.
XMR vs. DASH vs. ZEC: what will prevail?
So which private currency is more effective? Melanie Mohr, thinks that Monero is the true currency of privacy, despite recent flaws. The CEO and founder of the YEAY e-commerce platform, as well as creator of WOM, notes that XMR has a clear base development community behind it, something that has existed since its early days.
This allowed a token precursor, ByteCoin, to be bifurcated code when defects were detected in the original platform. A new genesis block was created and became XMR. Says Mohr:
XMR hides balances, transaction history and recipient address via stealth addresses. The sender is also hidden using ring signatures and transaction amounts are also encrypted via RingCT. XMR is also working on Kovri to hide its geographical location and IP addresses through garlic cryptography and garlic routing. It is evident that the XMRs are the leaders in the private coin space and privacy is their main objective, since privacy is not a default option. Furthermore, XMR is actively challenging to achieve ASIC resistance.
Mohr also states that Zcash technology is superior. Even if you notice that zk-SNARKs, the basic technology of ZEC is an interesting step for cryptographic tests, you too make this point:
They are not in agreement with each block that is extracted the founders should get a percentage of the block premium. This is known as Founders Reward, which started with 20% of the block premium, which gradually declines in 4 years is something I can not agree with. ZEC has a company behind it with private investments and privacy is optional, which is not really used, and chain analysis allows tracking users. There were also numerous FUD opportunities around the ZEC team that communicated with secret agencies and the like.
Dash was the first cryptocurrency to be marketed with a separate privacy function, emphasizes Ryan Taylor, CEO of Dash Core Group. Does the PrivateSend feature of the token:
dashThe privacy function is very similar to the mix of transactions that are available: we provide it at lower costs and in a more user-friendly, secure and effective way. Although less than 1% of Dash transactions use PrivateSend, it is a convenient and cost-effective way to provide more privacy to the user, while keeping the full ability to control the ledger.
However, Mohr believes that the main goal of the DASH community is to simply get traditional adoption. It is in his view that privacy is not their main objective or objective. For them privacy is just an option, not the default setting.
With DASH, PrivateSend is used to send a private transaction, which is a modified version of CoinJoin. Masternodes is responsible for masking coins to ensure privacy, while masternodes can be obtained with 1k DASH. When the PrivateSend transaction is sent to the masternodes, the masternodes see the recipient, sender and the amount in a clear view, which means that it is not private, and if an entity had to control a large portion of the masternodes can use this information to their advantage.
During the first 48 hours of DASH launch, 2 million tokens have been installed, explains Mohr. Only later in its development the total offer of tokens was reduced from 84 million to 18.9 million. Typically when the total offer of a currency is reduced, the circulating offer is also diminished.
This did not happen with DASH. The 2 million unsecured coins remained at 2 million. This means that when there were 84 million tokens, the 2 million were 2.38% of the total supply. When this was down to 18.9 million, the 2 million became 10.58% of the total supply. She warns:
Keep in mind that there are only 8.3 million circulating offerings, so clearly the network works for the individuals who control those 2 million unsettled coins and generate a large income from multiple masternodes. If privacy is an option, private transactions are considered suspicious transactions that make the real capacity of a private currency.
While Monero is among the top 10 most popular cryptocurrencies, Quoc Le, CEO of a public blockchain infrastructure provider QUANTA, believes that eventually Zcash will prevail.
Its superior technology (zk-SNARKS) not only completely hides the transactions (a feature that is optional). The technology has the potential to be adopted with the support of Vitalik, to allow Ethereum to scale transaction rates from 15 tps today and up to 500 tps (increase of 30X +). Considering the use of zk-SNARKs for mass validation transactions already, Vitalik Buterin will help the adoption of Zcash by giving it mainstream coverage.