On Thursday, Monero lead maintainer Riccardo Spagni appeared on an episode of Monero Talk. During the interview, Spagni made comments regarding the possibility that Bitcoin has been able to get to where it is today due to the lack of full anonymity provided by the peer-to-peer digital cash system.
Satoshi’s Privacy Mistakes
Monero Talk host Douglas Tuman asked Spagni about his thoughts regarding the greater cryptocurrency user base’s acceptance of Bitcoin as the gold standard despite its lack of privacy features. In his response, Spagni first discussed why Bitcoin lacks strong privacy in the first place.
“[Bitcoin creator Satoshi Nakamoto] thought that things like using random change addresses would be sufficient,” said Spagni.” Clearly, he was wrong.”
Spagni also pointed out that Nakamoto publicly acknowledged that Bitcoin has its shortcomings when it comes to privacy.
“He didn’t have the knowledge that we have now,” added Spagni. “He didn’t know how traceable Bitcoin actually was.”
Lack of Privacy a Good Thing?
Although there are always new proposals coming out for ways to bring better privacy to Bitcoin, Spagni has his suspicions that Bitcoin wouldn’t have made it this far if it had strong privacy from the start.
“Regulators have been comfortable with it because of the lack of privacy,” said Spagni.
The longtime Monero developer added that regulators were first scared of Bitcoin because it could be used to do things like send money to North Korea. According to Spagni, these regulators are less worried when they’re told that this sort of illegal activity can be traced on the public blockchain.
“I think that’s a good thing because Bitcoin is the thing that warms the regulators up . . . Then Monero comes along and other privacy-enhancing systems like Zcash, Grin, and so on that have their own set of privacy enhancements, and regulators go, ‘Oh, scary technology. But we’re already used to Bitcoin, so this isn’t that different,’” explained Spagni.
Privacy Enhancements for Bitcoin are Available
Although Bitcoin is far from anonymous by default, Spagni pointed out that there are still ways to enhance the level of privacy in Bitcoin transactions.
“I encourage anyone who wants to improve their Bitcoin privacy to look at things like Wasabi Wallet,” said Spagni. “Samourai Wallet is trying hard as well. JoinMarket still exists. And you know, the more liquidity there is for things like CoinJoins the better. It’s not going to be close to Monero’s level of privacy, but it might be sufficient.”
Spagni added that future improvements, such as Schnorr signatures and Taproot, will also have a positive impact on the level of privacy offered by Bitcoin. Having said that, Spagni is not bullish on the long sought after Confidential Transactions improvement finding its way into Bitcoin.
“I do think we are going to get to a world eventually where privacy is the default with Bitcoin, [but] it might not be as private as Monero,” said Spagni.