The fact that bitcoin and other cryptocurrencies are built on a public ledger blockchain makes transactions made on their blockchains open to public scrutiny.
While it is possible to transact with bitcoin without revealing the identity of the dealer, all such transactions are recorded on a public ledger and can be traced back to the receiving wallet. This means that transactions are not fully decentralized.
The quest to address this flaw found in bitcoin has led to the creation of a new type of cryptocurrency known as a privacy coin. These types of coins offer completely decentralized transactions and once completed, no trace of such transactions remains. Here, immediately after the transaction is completed, both the identity of the dealers and the transaction details are erased.
Given the high level of secrecy involved in the use of privacy coins today many countries have banned its use in their countries; as promoting crimes and money laundering. With more countries now banning privacy coins, many fear that the ban could slowly spread across the globe. Can Privacy Coins Survive the Next Decade? Can Investors Still Buy the Popular Privacy Coin? Zcash (ZEC), Monero, Firo, Decred Horizon, etc., using centralized crypto exchanges? This work has addressed these burning questions on the use of privacy coins.
What are privacy coins?
Privacy coins are cryptocurrencies built on a fully decentralized network; Thereby making it impossible to track both the transaction and the identity of the user. Privacy coins are often used by merchants who do not want to leave any trace of their transactions later. These coins are very different from bitcoin and other cryptocurrencies which record transactions on a public ledger on the blockchain. With privacy coins, there is no record of transactions blockchainto see a third party.
Will Privacy Coins Survive the Next Decade?
The high rate of crime committed today using privacy coins has turned many governments away from it. These coins have been found to be a means of sponsoring terrorism and promoting cyber piracy. Therefore, it is completely illegal to use them in South Korea and Japan today. Other countries such as Algeria, Egypt, Iraq, Nepal, Qatar and Tunisia, Bangladesh, Morocco etc. have completely banned the use of cryptocurrencies including privacy coins in their countries.
Some countries have warned various centralized exchanges in the region to never list privacy coins on their platforms. With the increasing restrictions on privacy coins today, many now fear that these coins may not survive the next decades.
Yet, amid growing restrictions on the use of privacy coins, not all countries are opposed to it today. There are also some investors who consider it to represent the true purpose of cryptocurrency,
Above all, the most important factor that can erode the privacy of coins is when governments achieve complete regulation and centralization of crypto transactions. In such a situation, it would be difficult to use the privacy coin.
Twelve Popular Privacy Coins You Need To Know
- Dash (Dash)
- Monero (XMR)
- Zcash (ZEC)
- Kshitij (Jane)
- Decree (DCR)
- Oasis Network (ROSE)
- secret (scrt)
- KEEP NETWORK
- The Pirate Series (ARRR)
- Status (SNT)
- IEXEC (RLC)
Benefits of using privacy coins
- Provides fully decentralized transactions.
- Transactions involving privacy coins are nearly impossible to trace.
- They are usually built on a strong network.
Disadvantages of using privacy coins
- Promotes crimes and cyber piracy.
- Often used to sponsor terrorist activities.
- Promotes money laundering by robbers.
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