keep grinning! Source
Before DeFi projects sent goosebumps across the crypto space, before proof-of-stake coins made their way to the crypto space and introduced the idea of ‘passive income’ which was well received by cryptocurrency enthusiast, before each of these concepts made the headlines and topped the trends for a very long while and made massive returns for early investors, privacy coins were very prominent projects in the crypto space and one which drew huge attention from cryptocurrency enthusiasts.
The idea of staying in control of the visibility of your transactions, deciding who sees your activities and doesn’t, surely appeals to the majority, apart from cryptocurrencies and blockchain technology, privacy keeps climbing the stairs in the hierarchy of human social needs, despite being termed a miscellaneous and social need, privacy could be more important than you’ll ever imagine it to be. The fact that McAfee ate his words (on bitcoin price) instead of his D…but still upholds his views about the need for strong privacy in cryptocurrency transaction reiterates the importance of privacy, at least he won’t get to eat his words again this time. I’m convinced he still HODLs a good amount of Monero (XMR), maybe he bought some Deep onions or possibly dumped his bags for his privacy coin Ghost; whichever way he still remains a huge fan of privacy…just like each one/ most of us.
Due to the increasing importance of privacy in our contemporary world, privacy coins where a regular buzz in the crypto space and the several work-arounds employed by privacy coin projects to offer total or partial privacy were impressive enough to earn them the attention they got when they emerged. From bitcoin’s boring lengthy addresses to monero’s Ring signature protocol and the deep send protocol by Deep onion not to forget PIVX’s zerocoin protocol and NIX’s ghost protocol, privacy coins utilize several different work-arounds to make transactions secure and as private as possible, the correlation between privacy and security have made both terms more precious.
Each unique privacy coin enjoyed much love from cryptocurrency investors and just like most other privacy protocols, the introduction of the mimblewimble privacy protocol also had investors clamouring for projects which employed this protocol. Mimblewimble privacy protocol offers privacy by gathering huge amount of transactions into a single incomprehensive package. The bulky and unarranged stacks of transactions is extremely difficult to parse. A snooper will have a very hard time sorting this package to trace transactions, it is hence considered a reliable privacy solution as the eavesdropper is unable to decipher single transactions. Beam privacy coin was the first to officially employ the mimblewimble protocol despite Grin coin being the first to tease the development of a coin which employs the mimblewimble protocol to improve privacy and safety of transactions.
Let me guess, you are having a flashback trying to remember when this all happened, the monero days, the verge trends, grin coin was also a buzz, beam also had some run of gains, not to forget dash and Zcash. Many non-privacy coins also made ambitious moves to include privacy to their provisions…everyone wished to be a part of the trend!
Mimblewimble blockchains offer improved blockchain transaction privacy
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For one reason or the other, this trend couldn’t last forever, well, may be because nothing actually lasts forever. But with the emergence of new and exciting concepts, the privacy coin boom gradually came to an end and soon forgotten as every attention were channeled to the new projects. I wouldn’t blame it on the emergence of proof-of-stake coins, privacy coins like PIVX are POS too. Probably this trend died down in correspondence with natural sequences, or the crypto space took its eyes off privacy coins due to some dysfunctionalities experienced with some privacy coins or maybe because most cryptocurrency transactions are actually private. I mean, being able to trace a transaction doesn’t mean being able to trace the sender himself. We are yet to know who sent those 40 BTC from one the earliest blockchain wallets, so it’s all private in the real sense. Whatever reason that was, fact remains that privacy coins do not ring the bell so much, at least not like they used to do.
But that might change soon…
WHY
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Alright, let’s get it clear, I’m not trying to promote privacy coins or suggest you go fill up your portfolio with some privacy coins, but as blockchain technology grows further, it is inevitable that our attentions will be drawn to privacy-centred cryptocurrencies once again.
Human craving for privacy is on the consistent increase and with each age that passes our taste for privacy gets even more intense. From brick wall demarcations to building our houses on the hills far away from common views, the urge to stay private is innate in humans, well, most humans. Most (every) cryptocurrency wallet address are boring codes and rarely bear the name of their owners (except they wish to include this for blockchains that offer such feature), hence every transaction is actually private as the owners of the addresses can hardly be traced. However, this could only be a level in our craving for privacy and in the near future, we might grow to despise the fact that our transactions could be traced at all, even when they can’t be traced to us in person. We might want to ‘stay ghost’ in the near future, at least for the fun of it. This is the main reason why privacy coins took the trends in the first place, and a repeat won’t be a surprise.
Unfortunately, despite the cryptocurrency address structure which makes it hard (impossible) to ascertain the direct signer of a transaction, tracking services have developed ways of tracing transactions to the sender, especially when these transactions are made by very important institutions or coin holder(s). Such institutions’ or persons’ privacy is completely breached in this case and this might be against their wish. It will only take time before they seek possible means to put an end to this and regain control of their privacy. When it is huge amount on the move from popular institutions, onlookers tend to develop different emotions towards this move and react to it, a major cause of some price instability. If these affected institutions or persons should move to put an end to this, then the only way is privacy coins. Such institutions are always influential enough to draw other cryptocurrency enthusiasts to follow same route…privacy coins
DeFi is the current buzz, but what if DeFi makes its way to privacy blockchains? An explosion, right? Sure. With DeFi on privacy blockchains, it is security, privacy and decentralization, three most sought-after virtues in everyday finance. Something to look up to and something which will unarguably bring back the days of boom for privacy blockchains. If these blockchains are scalable and offer low transaction fees in addition to their smart contract provisions, then privacy coins will not only boom, but the ethereum days might be over too. Dreams, right? But dreams do come true…especially in the crypto space.