Those who are familiar with the cryptocurrency world do probably know that there are numerous tokens, dubbed privacy coins, appreciated for being anonymous. Dissimilar to Bitcoin, anonymizing users’ ID and also having a public ledger and a transparent wallet, the altcoins like Monero (XMR), Zcash (ZEC), and Dash (DASH) luxuriously mask the identities of senders and receivers.
The people, avoiding their financial transactions to readily turn out to be public, find this useful, and these assets are also attractive for being used by those shadier like terrorists, drug dealers, and other criminals. The government regulators keep working to limit the effectiveness of these coins, although not always successfully.
While their clandestine availabilities are widely appreciated, any coin should keep its words to be reasonably effective. Yet, this is not always the case. Monero devs team recently found a substantial bug in the altcoin’s wallet software, enabling hackers to draw XMR from exchanges with a small transaction fee.
XMR, DASH, and ZEC: Which one is to dominate?
Which privacy coin is most effective? Melanie Mohr thinks of Monero as the true privacy coin against recent glitches. The e-commerce platform YEAY’s CEO and founder and the WOM’s creator emphasizes that XMR’s rooted development community is behind it from its very creation.
So, as a precursor of the token, ByteCoin was coded as forked when the original platform turned out to be deficit. A new block was generated as XMR. Mohr states:
XMR hides balances, transaction history, and receiver address via stealth addresses. The sender is also hidden by using ring signatures, and transaction amounts are also encrypted via RingCT. XMR are also working on Kovri to hide geographical location and IP addresses via garlic encryption and garlic routing. It is evident that XMR are the leaders within the privacy coin space and privacy is their main focus, with privacy being a default not an option. Also, XMR is actively hard-forking to achieve ASIC resistance.
Besides, Mohr advocates Zcash technology to be superior. And she highlights that as ZEC’s underlying technology, zk-SNARK is an unexpected progress for cryptographic proofs. She added:
I do not agree with every block that gets mined the founders should get a percentage of the block reward. This is known as Founders Reward, which started at 20% of the block reward, which gradually decreases over 4 years is something I cannot agree with. ZEC have a company behind it with private investment, and privacy is optional which is not really used, and chain analysis allows user tracking. There have also been numerous FUD occasions around the ZEC team communicating with secret agencies and such.
As the Dash Core Group’s CEO, Ryan Taylor states that having a distinctive privacy feature, Dash is the first cryptocurrency in the market. He indicates with regard to the token’s PrivateSend feature that:
Dash’s privacy feature is very similar to the transaction mixing that is available with Bitcoin – we just provide it at lesser expense, and in a more user-friendly, secure, and effective fashion. While less than 1% of Dash transactions utilize PrivateSend, it’s a convenient and cost-effective way of providing increased privacy to the user, all while maintaining a full ability to audit the ledger.
On the other hand, Mohr think of the DASH community’s main focus as just getting mainstream use. According to her, the privacy is not their originary target or aim. Privacy is just an option, not a default feature.
With DASH, to send a private transaction PrivateSend is used which is a modified version of CoinJoin. Masternodes are in charge of masking coins to ensure privacy, and masternodes can be obtained with 1k DASH. When the PrivateSend transaction is sent to the masternodes, the masternodes see the recipient, sender and amount in clear view, meaning it’s not that private, and if an entity was to control a large portion of the masternodes they can use this information to their advantage.
More emphasizes that tithin 48 hours following the release of DASH, 2 million tokens have been insta-mined. The total token supply decreased to 18.9 million from 84 million later in its course. When the total supply of a coin gets decreased, the supply in circulation also typically gets lower.
This is not the case with DASH. The initial insta-mined coins of 2 million stayed the same as 2 million. Hence, if there are 84 million tokens, this 2 million is 2.38% of total supply. So, if it is down to 18.9 million tokens, this means that 2 million turn out to be 10.58% of total supply. Also, she notes:
Keep in mind there is only 8.3 million circulating supply, so clearly the network works in favor of the individuals who control those 2 million insta-mined coins, and generate a large income from being multiple masternodes. If privacy is an option, then private transactions are treated as suspicious transactions rendering the true ability of a privacy coin.
Monero is one of the top-10 most popular cryptocurrencies, and according to the public blockchain infrastructure provider QUANTA’s CEO, Quoc Le, Zcash will keep standing.
Its superior technology (zk-SNARKS) more than just completely hides transactions (a feature that it is optional). The technology has the potential to be adopted by Ethereum with Vitalik’s support, to enable Ethereum to scale transaction rates from 15 tps today, and up to 500 tps (increase in 30X+). By considering using zk-SNARKs to mass-validate transactions already, Vitalik Buterin will help Zcash adoption by giving it mainstream coverage.