The Dark Ledger: The Privacy Coins Taking Anonymous Shopping Mainstream
Less than a year ago as cryptocurrency prices doubled over the holiday season, few mainstream payment gateways accepted the virtual money fattening crypto wallets. If you found the perfect sweater for your loved one on Shopify, you were obliged to pay for it with fiat currency. Today the challenge is choosing which gateway to use. Most major e-commerce payment services have added cryptocurrencies to the choice of payment methods.
Consumers however are still not spending their cryptocurrency. A number of behavioral barriers to shopping in crypto still exist. Foremost, consumers worry about security, transaction speed, and the ability to freely exchange cryptocurrencies.
New privacy coins are in circulation with solutions to these impediments to mass adoption. Privacy coins ensure your personal identification as well as the amount, time and other transaction information are removed from peer-to-peer transactions. Monero (XMR), Dash (DASH), ZCash (ZEC) and other privacy coins are scrubbing coins of identifying information to create more trust and security in crypto money. By turning you into an anonymous shopper, they hope you will open your crypto wallet over this holiday season.
Some fear that like the dark web, an anonymous Blockchain could harbor drug dealing, pornography, cyber criminal and other illicit activities. New privacy coin contenders are focused on the huge legitimate market opportunity for privacy coins with improved performance. By incentivizing their token holders to cooperate to support the network rather than their own self-interests, they are layering unmatched levels of privacy and security on transactions.
The Scramble for Privacy
Euno (EUNO), which has developed a truly anonymous rather than pseudo-anonymous blockchain, says a hacker would need to break through an algorithmic chain of 11 different hashes to access data. Cryptocurrency payment methods are popular because parties can transact with anyone in the world without worrying about payment holds and restrictions, but Blockchain transactions are audible and details can be traced.
Privacy coins, which essentially wash coins of any traceable information, are continually improving performance. PIVX (PIVX, private instant verified transaction), a fork of the DASH Blockchain, is popular due to its security enhancements and faster transaction speeds. AIAS Coin (AIAS), in turn, has forked the PIVX blockchain to package these performance enhancements in a plug-and-play extension that makes it easy for merchants to offer anonymous transactions to customers.
Euno boasts the fastest transaction processing time of any cryptocurrency in the world, all while leaving no trace on the coins. Transactions sent via DARKSEND are private and untraceable. Although these hypersonic coins whip through the ethersphere undetected, your recipient’s wallet will immediately detect the transaction while your identity and transaction details will remain concealed.
These performance improvements are increasing the use of privacy coins in e-commerce and business applications. LuxCore— headed by newly appointed CEO John McAfee, the developer of leading cybersecurity software McAfee— has created a virtual bridge called LuxGate to extend private transactions across enterprises and government. By connecting public privacy Blockchains and private enterprise networks, privacy can be maintained across networks, including in transactions with financial institutions.
How do privacy coins cover their tracks? Many advanced privacy protocols are being deployed by coins but generally, the history of these coins is erased through a decentralized mixer protocol. Let’s say three people sent coins using the private send protocol—John (10 coins), Mary (8 coins) and Frank (5 coins). All 23 coins are mixed together in a pool. From this random pool, the now traceless coins are then deposited in the receivers’ wallets. Some services have a minimum coin send. DARKSEND, for example, would require Mary to send 10 coins. Mary could then access the two extra coins at a random pool address.
Low Stake, High Reward Games
Ensuring you fly under the radar of cookies, malware and other decryption bots in global e-commerce transactions require a lot of resources. By helping to perform work verifying and mining privacy coins, you can earn generous rewards. Privacy coins provide various ways of earning rewards for those who dedicate resources to the operation of their networks, including Proof-of-Work, (Pow), Proof-of-Stake (PoS), and Masternodes. Some egalitarian coins are paying stakers and miners more in crypto rewards for cooperating. Drawing on game theory, these privacy coins base their incentive systems on cooperation, recognizing that the overall payouts are higher when everyone works towards a shared goal.
Although you still need a lot of coins to stake a node or wallet, those with lower stakes are treated more fairly. The stake and rewards vary among privacy coins: you can run a masternode on Euno for 50,000 EUNO and earn 60 percent POS or 16,120 LUX on LuxCore for 20% POW/POS. Masternodes, which run real-time copies of the Blockchain, like regular nodes process transactions but also perform additional functions. These super nodes can process private, instant and fast transactions.
Privacy coins
These privacy coins have devised fairer ways to divvy out rewards to incentivize you to process transactions. Reward systems typically reward stakers according to their wealth based on the amount they stake. In a meritocratic twist, Euno distributes rewards to wallet holders and nodes in an amount inverse to the amount of tokens they hold. Euno also shares the revenues with users of its token. The privacy coin engenders trust in its system and reduces price volatility by rewarding users who use the Euno mobile app to make point of sale purchases with EUNO tokens.
LuxCore distributes 1 LUX to all staked wallets, regardless of the amount of LUX in the wallet. Although stakers with more coins will receive rewards more often, all stakers start earning immediately. To make supporting a decentralized node of its blockchain easier, LuxCore has introduced the first proof-of-stake wallet as a service.
While incentivizing and rewarding cooperative behavior, these dApps are accelerating cryptocurrency adoption with their solutions to privacy, security and transaction speed. Like many alt tokens, however, they are not among the major cryptocurrencies accepted by major e-commerce payment systems. With a market awaiting a solution, these stealth tokens are leapfrogging payment processing solutions.
Euno and Pivx provide point of sale payments via NFC (new field communication) via their mobile apps. The mobile app can then instantly convert the payment to fiat and forward it to the merchant. AIAScoin has developed a plug-and-play dApp to deliver fast, private cryptocurrency transactions for content management systems (CMS), such as WordPress and shopping carts Shopify and Magento.
Considering that privacy coins are predicted to be among the highest growth coins in 2019 by a panel of fintech leaders, the potential for these new polished up privacy coins is high.
