The co-founder and face of Ethereum, Vitalik Buterin has expressed his interest in incorporating privacy features into Ethereum.
It seems Buterin is partial to the ZK-SNARKS technology that is used in privacy coin Zcash. Even so, his senses seem to be particularly excited about any developments surrounding privacy protocols. This became more obvious when a research paper was released called, “FloodXMR: Low-cost transaction flooding attack with Monero’s bulletproof protocol.”
The researchers decided to look into what they call “flooding attack with Monero’s bulletproof protocol.” So basically, this involves an attacker flooding the network with their own transactions and then getting rid of “mixins from transaction inputs.” By doing this, the attacker could potentially trace almost half of inputs at a cost of less than $2,000.
In fact, the lead developer on the Monero Protocol, Riccardo Spagni (Fluffypony) is in New York for the Magical Crypto Conference but hasn’t responded to the FloodXMR research paper at the time of writing.
But Buterin did and took to Twitter to say:
Privacy schemes where the anonymity set of a single transaction is smaller than the entire set of users of the scheme are looking weaker and weaker with every passing month... https://t.co/vTHNQRsVUT— Vitalik Non-giver of Ether (@VitalikButerin) May 10, 2019
Monero and Ethereum
Some people in the crypto community highlighted that Monero isn’t the only project which has some obstacles in the way. One Twitter user pointed out that:
“Ethereum has its obstacles, so does Monero. I’m sure some very bright minds will take care of it. Both are legit projects.”
To this, Buterin wanted to clarify what he meant by saying:
“I hope Monero overcomes its obstacles by switching to privacy schemes that make the anonymity set for each transaction be the set of all Monero users!”
The co-founder continued saying:
“The above wasn’t even intended to be against Monero in any way. I’m following this debate between different privacy tech mainly with an eye to seeing what privacy schemes to help support as layer 2’s for Ethereum.”
Privacy on Ethereum
At the Ethereal Summit that occurred in New York over the weekend, a ConsenSys event that’s been dubbed as the “SXSW of blockchain.” But even so, the ETH co-founder still found the time to weigh in on Monero’s privacy protocol.
At the conference, the discussion went on in regards to Ethereum 2.0 and the shift to the proof-of-stake protocol, with the CEO of Messari Ryan Selkis saying that it is a still a few years away yet. On top of this, if it is true, it could push features such as privacy further back as well. However, Buterin clearly had the privacy aspect on his mind when he responded to Tesla CEO Elon Musk about what can be built on Ethereum.
At the end of April, Musk put out a tweet that simply read “Ethereum”, Buterin invited him to Devcon to which Musk responded with “what should be built on Ethereum?”.
In response to this, Buterin gave him five points as to why people should build on Ethereum with a very drawn out answer(s):
“My top picks (1):
* A globally accessible financial system, including payments, store of value, also more advanced stuff like insurance http://hurricaneguard.io/
* Identity: "sign in with Facebook" -> "sign in with an ethereum account, no intermediaries". Also web of trust...
* All sorts of registries should publish on chain for security and easy verifiability, see my thread on this https://twitter.com/vitalikbuterin/status/1072158957999771648
* Experimenting with new forms of human organizational structure, eg. @MolochDAO
* All sorts of micropayment use cases via payment channels...
* Markets for personal data for privacy preserving machine learning (you pay me X, I let you homomorphically execute function Y on my data that's been attestated to by Z...)
* Cryptoeconomics for spam prevention in social networks
* Cryptoeconomics / micropayment schemes to reward publishers of good content
* Testing ground for new market designs, eg. frequent batch auctions, combinatorial auctions, automated market makers (eg. http://uniswap.exchange )
* p2p marketplace for internet connections / incentivized mesh networks
* Identity, reputation and credit systems for those that currently have few resources (eg. refugees)
* Decentralized DNS alternatives (eg. http://ens.domains/ )”
Buterin seems to think that ZK-SNARK technology could help boost Ethereum’s scalability to around 500 transactions a second. Not only that but Ethereum would be able to scale too.
This approach is different to the Litecoin blockchain though which is adding a second-layer payment solution Lightning Network and is also looking towards privacy.
When you consider the “precarious” nature of the Monero traceability report, it makes sense for all privacy coin project leaders to team up instead of battling for the top spot.