A case about importance & value of privacy; mostly ignored but it happens regularly. News by Wublockchain
‘'CZ said a client executive was lured to Montenegro, where he was kidnapped and robbed of $12.5 million in cryptocurrency. Binance contacted its partners to freeze approximately $11.8 million in Tron wallets. There has been an increase in similar kidnapping cases against cryptocurrency holders.’’
Indeed, privacy is simply a property of sound money. Without privacy preservation, anyone can see how much you have, and how and where you spend your money. The most important privacy preservation is still knowledge about the value of outputs in transactions. Mimblewimble therefore remains the biggest and most revolutionary privacy breakthrough in crypto since only those involved in a transaction can see the amounts without any costs in terms of complexity and scalability.
The issue of privacy has many implications. It is not enough to use cryptocurrencies that are not even anonymous. User privacy from centralized exchanges has been crushed. On a weekly basis we hear of user databases being stolen or accessed by some. Normally these companies should be prosecuted or compensate their users (since they demand the users’ personal information).
But I’ll dwell on something else very important.
Privacy starts with ourselves. I’m really surprised that a man was kidnapped for such a large sum of money. I’m sure some people knew a lot. We must never mention if we use cryptocurrencies, if we trade or if we have a profit from our activities.
There are always eager eyes and ears that don’t have good intentions.
Recently in Greece a computer programmer disappeared, who unfortunately was found dead. According to his best friend he had a very large fortune in cryptocurrencies since he was involved since 2010!
He was looking for ways to exchange a very large amount of money and as a result he talked to many people. He had also confided in others that if something happened to him that they should give his mother bitcoin private keys. In the end it is said that a gang which obtained information kidnapped and killed him. The successive mistakes and invasion of our privacy starts and unfortunately always ends with us.
Mimblewimble uses a privacy technique called Confidential Transactions which was known a few years before MW appeared. It didn’t really introduce new kinds of blinding. It’s a new compression technique, hence better scaling.
Thx, refreshing my knowledge of Confidential Transactions:
The scanning keys mentioned (2nd last paragraph) here is the kind of viewing key the wallet rewind hash function produces?
@oryhp If I understand it correctly the main benefit of mimblewimvle over regular confidential transactions are CoinJoin (via dandelion), Cut-Through and ditching ring signatures?
Feel free to correct me.
I think so yes.
You’re mostly right. I’ll explain it a bit for anyone else that might want to refresh the knowledge. Confidential transactions provide a different way of representing the amount. Instead of an integer, it’s a Pedersen commitment (and a rangeproof). This means that the signatures over inputs stay the same as on bitcoin (there are no ring signatures). What MW did was inject also the spending key into the same Pedersen commitment. We still need a signature to confirm we want to spend, but this one doesn’t specify for which input it is. So we get rid of signatures that bind to specific input and have a single signature for all inputs (and outputs). But yes, this simple modification of Confidential Transactions allows us to merge two transactions into a single one which is a noninteractive coinjoin. We can also forget spent input/output pairs because they cancel out algebraically and the signature no longer binds to specific inputs/outputs - that’s the noninteractive cut-through which is the magic that compresses the chain.