In recent years, privacy coins such as Monero, ZCash, and Dash became popular.
They are promising to provide privacy to the cryptocurrency users that public blockchains like Bitcoin and Ethereum cannot.
What is a Privacy Coin?
Privacy coins are cryptocurrencies that hide your identity when making transactions.
They also can keep your wallet anonymous and/or hide the balances of transactions as well.
Privacy coins such as Monero, Conceal Network, RYO Currency, Wownero and Turtle Coin etc. provide these benefits by obscuring the sender’s address, the receiver’s address, and the transaction amount when executing each transaction.
Public blockchains like Bitcoin and Ethereum do not offer true privacy as their transactions and wallets are publicly visible.
Why do we need privacy coins?
Public blockchains are viewable by anyone and you can easily track the balance of the wallet and transaction history (including the public wallet addresses of senders and receivers).
This may be a problem in some situations.
Who wants his/her wallet to be seen by everyone?
Personally, I do not.
Who wants his/her messages to be seen by an authority?
Personally, I do not.
Privacy coins solve these problems by employing a number of different techniques, giving their users truly privacy.
Criticism About Privacy Coins
As privacy coins are truly anonymous, some claim that there can be problems such as fraud, tax evasion, money laundering.
The head of the Finance Committee of France’s National Assembly, Eric Woerth, is suggesting a ban on privacy coins.
Woerth considers the introduction of a ban on digital currencies that provide greater anonymity to users, stating:
“It would also have been appropriate to propose a ban on the dissemination and trade in [cryptocurrencies built] to ensure complete anonymity by preventing any identification procedure by design. […] This is the case for a certain number of [cryptocurrencies] (Monero, PIVX, DeepOnion, Zcash…) whose purpose is to bypass any possibility of identifying the holders. To date, regulation has not gone that far.”
In April of last year, Japanese regulators suggested similar measures by preventing cryptocurrency exchanges from trading anonymity-oriented altcoins Dash (DASH) and Monero.
Some Privacy Coins
Monero – https://www.getmonero.org/
Zcash – https://z.cash/
Dash – https://www.dash.org/
Conceal Network – https://conceal.network/
Ryo Currency – https://ryo-currency.com/
Turtle Coin – https://turtlecoin.lol/
Wownero – http://wownero.org/
Loki – https://loki.network/
(I will write about all of them in the future)
In my opinion, privacy coins are the future of cryptocurrencies which offer security, freedom and, privacy.
Although there are criticisms about the illegal use of them, before privacy coins, there were illegal transfers, fraud, tax evasion with the fiat money and probably after them, there still be.
It is not something about privacy coins, it is about people that make lots of money from this illegal money.
Nowadays, it became almost impossible to protect your privacy as everything is centralized and controlled by the authority.
I hope, privacy coins will be the solution to this problem.
I am really curious about how privacy coins will envolve and how regulators respond to the freedom that privacy coins offer.
Governments and the central authority surely want control over our wallets, funds, and private information. That’s why they are trying to ban privacy coins from exchanges.
However, it will become almost impossible when Decentralize Exchanges (DEX) become more popular and user-friendly. Banning a cryptocurrency from a DEX is not possible.
As privacy coins become even more and more popular and profitable in the future, in my opinion, they may bring freedom and privacy to us too.