- Amir Taaki, considered to have led the dark tech renaissance, has come out in the open and criticized the concept of Coinjoin systems.
- He also states that having the first-hand experience of implementing one system was frightful as it did not have a valuable output.
- Taaki, in his tweet, exclaimed that currently, zero-knowledge accumulators are the gold standard
Amir Taaki, considered to have led the dark tech renaissance, has come out in the open and criticized the concept of Coinjoin systems. In brief, these systems combine multiple Bitcoin payments for better safety and security. The transactions further clubbed to make it more difficult for outsiders to gauge the origin and destination of a particular transaction. Furthermore, a modification to the Bitcoin protocol is not necessary here.
The first creator of Coinjoin implementation disavows it
CoinJoin, CoinMix, CoinWhatever – absolute garbage (and I created the first CoinJoin impl)
MimbleWimble – interesting but worthless for privacy
Monero – marginally better but not anonymous
Lelantus – decent but still risky
Zero-knowledge accumulators – anonymous gold standard
— Amir Taaki (@Narodism) July 17, 2020
In his 17th July tweet, Taaki himself withdrew support from any of the Coinjoin systems currently running. He also states that having the first-hand experience of implementing one system was frightful as it did not have a valuable output.
There are threats of a DOS attack where a person can refuse to sign the joint transaction. On the other hand, a person can complete a particular transaction before the Coinjoin system completes its own. Altogether, a close-knit forensics team can easily link the transaction and reestablish the origin and destination.
Cryptography Aimed at Improving Privacy
Several startups now use cryptography to increase the security protocols within a transaction. Zcash, founded by Zooko Wilcox, provides privacy to users by using zero-knowledge proofs (zk-SNARKS). It does not reveal sensitive user information. Riccardo Spagni from Monero condemned the Zcash project. He leveled allegations that a user could easily trace back the original t-address.
The founder shrugged off the criticism and exclaimed that Zcash is a private ecosystem that uses a shielded pool mechanism to prevent information leak. Another extension of the Zerocoin protocol is Lelantus that plagues several limitations.
These are zero-knowledge accumulators that offer privacy schemes that are not well-known. The cryptography technique used in Lelantus may turn out to be insecure, where the validation process time is pretty low. In addition to the slow validation process time, it also has large transactions to run through. Consequently, it will lead to a reduction in the anonymity set size and costly transactions.
Taaki, in his tweet, exclaimed that currently, all accumulators are the gold standard, but due to the unknown characteristic, they cannot be fully trusted for huge transactions.