Cryptocurrencies like Bitcoin are often described as transparent, with all transactions publicly visible. But I keep hearing about privacy coins, which supposedly hide transaction details. How exactly does this work? Do they encrypt everything, or is there some other technique involved? I'm looking to understand the basics, so if anyone could explain or share a good resource, I’d really appreciate it!
That’s an excellent point you bring up! Unlike Bitcoin, which logs all transactions on a public ledger, privacy coins are designed to keep your activities private. They achieve this through methods like stealth addresses, which generate unique, one-time-use addresses for every transaction. Another key tool is zero-knowledge proofs, such as zk-SNARKs in Zcash, which let you prove a transaction occurred without revealing any details. Monero adds another layer with ring signatures that blend transactions with others. For a detailed overview, you should check out this article on privacy coins https://www.benzinga.com/content/428...vacy-coins-101—it’s a solid starting point for learning about how they work and the technologies behind them.
This is really interesting stuff! I’ve heard about Zcash and Monero but didn’t realize how intricate their privacy features are. Thanks for sharing the article link; I’m going to dive into it as well. It’s amazing to see the innovative ways privacy is being prioritized in crypto.