Ethereum Creator Vitalik Buterin Co-Authors Paper on Rooting Out Dishonest Crypto Users
If you’re interested in crypto, you’ll be fascinated by a new paper co-authored by Ethereum co-creator Vitalik Buterin. The paper explores a mechanism to identify and remove dishonest users from crypto mixing protocols. So, how does this mechanism work?
According to the paper, privacy pools can play a crucial role in weeding out unscrupulous crypto traders. These smart contract-based privacy projects allow users to generate new ETH addresses that are not linked to their previous transactions.
The proposal suggests that users can publish zero-knowledge proofs, demonstrating that their funds have no ties to unlawful sources without revealing their entire transaction history. By proving membership in custom association sets, users can comply with regulations and maintain privacy on public blockchains.
The paper also discusses the potential compatibility between privacy and regulation, arguing that it is possible to separate honest users from dishonest ones based on their ability to provide such proofs.
Hot Take: Privacy Pools – A Solution for Crypto Privacy and Regulation?
The concept of privacy pools and the mechanism proposed in the paper could revolutionize the way we address privacy and regulate cryptocurrencies. By allowing users to prove compliance without sacrificing privacy, this approach may provide a viable solution for combating money laundering and enhancing national security.
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