A new privacy-focused cryptocurrency has been created and released recently, a fork from the first cryptocurrency Bitcoin.
It’s called Bitcoin Private, and it incorporates elements from both Bitcoin and Zclassic, a now-defunct cryptocurrency with strong focus on privacy, and the predecessor to Zcash.
Bitcoin Private uses the ASIC resistant proof-of-work mechanism Equihash, which means the developers hope to keep Bitcoin Private truly decentralized in that this algorithm it would allow and incentivize mining using machines miners at home could keep up with.
But is Bitcoin Private necessary in the world of many cryptocurrencies? What problem does Bitcoin Private solve?
Privacy of Bitcoin
It is no secret that Bitcoin is not a private cryptocurrency. Arguably, it is the least private transactional means ever created: allowing the tracking of any one coin through all of its transactional history from the coin’s first inception.
With that said, the mainstream media sources and those sources outside of the cryptocurrency community tend to throw the world “anonymous” around within the top three adjectives used for attempting to describe Bitcoin to their apathetic audiences.
It is not true. Bitcoin is not private.
It can be made virtually private, yes, but in the real world and in Bitcoin’s current use forms, it isn’t private without a decent amount of work—even then, it can be traceable. It should come as no surprise to you that large alphabet agencies such as the NSA have been actively attempting and have essentially succeeded in tracking Bitcoin users. A solution is needed to solve this issue then, especially in the way that the dark web marketplaces operate.
But is Bitcoin Private that solution?
The Technologies Behind Bitcoin Private
When examining the technologies behind Bitcoin Private, we need to first understand a few things about Bitcoin, the core base for Bitcoin Private to exist.
It has full transparency over transactional history, applying each path of a coin into its main ledger (the blockchain). It is therefore by design that Bitcoin is in fact public—since each coin can be checked against all other transactions to ensure it isn’t “double spent” and ensure it is a legitimate coin.
But this design mechanism was improved with more privacy-focused cryptocurrencies. By adding another layer of encryption over the blockchain, coins like the now-defunct Zclassic, obscured the wallet addresses and the transaction amount, while still maintaining the cryptographic integrity required to validate each transaction. Bitcoin Private seeks to apply the technology from Zclassic to the Bitcoin protocol.
Other Privacy Coins
They both mask the true wallet locations, transaction amounts and the receiver’s address, albeit doing so in slightly different ways (although following some transaction linkability research Monero has moved to Zcash’s RingCT method of obscuration, reducing differences further). The main difference comes down to the protocols used, and the mining technology required.
Monero has been implemented in multiple dark web marketplaces, which unquestionably increases the overall market price for the cryptocurrency. One may go as far as saying that if you have the option, you should in fact be using Monero as your cryptocurrency of choice for dark web marketplaces.
Zcash, however, has taken favour with Russian cybercrime syndicates and so-called “cryptolocking” malware purveyors. One malware infects the target device, the core disk is encrypted and only on payment of a set amount of Zcash would the criminals provide the decryption key to the target. Again, regardless of the nefarious nature, this increased the price of Zcash notably.
Where Does This Leave Bitcoin Private
In the end, it appears as though this is just another altcoin run by a few people with an idea—an idea to get wealthy, not to change the world.
Both Monero and Zcash have already got uses in the real world, regardless of the fact that these uses are “undesirable” or downright illegal.
Monero is at the heart of cryptojacking and has been implemented into several dark web marketplaces. And Zcash has taken favor with cryptolocking malware spreaders. They have a form of adoption, which is the next and most important phase of a cryptocurrency’s life.
Without adoption, the token or cryptocurrency will remain speculative forever, and eventually will be killed with the inevitable future market crashes.
It is early days and therefore impossible to know what will come of Bitcoin Private. However, Bitcoin Private appears to solve a prominent problem deep within Bitcoin’s center.
But in the strange and wonderful world of cryptocurrency, solving a problem or even having a brilliant whitepaper basically amounts to nothing. It is a mere spark. Whether there is enough accelerant around that spark to light a fire is a whole other conversation, one which cannot be had until more time has passed and until Bitcoin Private finds its form of adoption.
Latest posts by Con (see all)
- Latest News on Cryptocurrencies of the Dark Web | Week 27 – 2018 - July 3, 2018
- Essay: A Brief History of Kim Dotcom, the Internet’s Architect of Revolution - June 26, 2018
- Op-Ed: Going Dark—Encryption and the Dark Web - June 22, 2018