Bitcoin Forum

Bitcoin and Litecoin moving in on Monero Confidential Transactions (CT)

http://oracletimes.com/bitcoin-and-litecoin-moving-in-on-monero-confidential-transactions-ct/

Confidential Transactions (CT) It is no secret that the success of Monero since January 1, 2017 is directly linked to the overall cryptomarket bull run but also in its unique quality of confidential transactions.

Today Charlie Lee, creator of Litecoin, announced via Twitter that both Bitcoin and Litecoin are working to achieve CT and will be able to implement via a “soft” fork.

Confidential Transactions (CT) are important for several reasons and most of them are perhaps illegal. For the tin foil community CT means the government cannot track movements of currency or payments made between parties. This facilitates shielding from the ever present big brother but also allows transfer of currency across borders of nations without scrutiny.

The benefit of this should be obvious. Currently national currencies are tied in value to the backing of the printing nation with the US Dollar as the benchmark. Problems occur when a currency crisis such as the Asian Financial crisis in 1997 causes widespread devaluation of currency backed by a nation in reference to the US Dollar. This forced the IMF to step in to provide money to stabilize South Korea, Thailand, and Indonesia. The widespread inflation wiped out the savings of regular people in these nations and bankrupted many companies.

If a currency could be created that was not backed by nations, could flow across borders without scrutiny, and was not subject to taxation then it would be insulated again the currency fluctuation of any nation and traded on one standard worldwide.

As Cryptocurrency has value now many nations such as the United States are stepping in with policies for taxation and tracking for illegal activities. The Silk Road was brought down (along with some federal agents) through the tracking of Bitcoin Wallets and transactions on a public searchable blockchain.

If it is going to be implemented via a soft fork or protocol upgrade, I doubt if anybody will publicly voice support for it. Already bitcoin's pseudonymity causes issues for regulators. Anything enhancing anonymity won't find support from those favouring regulations.

Regulators won't like this at all. Pseudo anonymity can already be very hard to track but implementkng confidential transactions would provide total anonymity (which is even better for users). Now I went ahead and checked the tweet dfor myself and I've got to say I was kind of mislead by this article. Lee wrote that confidential transactions were the only thing bitcoin ans litecoin are missing, he didn't write anything about it actually getting implemented on the bitcoin chain. But stil, a lot of food for thought because implementing CT in both litecoin and bitcoin could possibly result in Monero becoming obsolete.

Why wouldn't they support it? Who would like their transactions to be spied on? IMO confidentiality is very important for any transaction in any currency. We don't need a third party to be present in an exchange between two parties, why would you want that?
Let's say you decided to buy something very rare and expensive from someone, would you like the whole world to know when and what you paid for? That would only make you a target for thieves and i'm not talking about the government thieves ;) but also the regular ones.

If bitcoin and litecoin switch to the use of confidential transactions, I think this will only increase their popularity, and with them demand with value. Bitcoin has already been sufficiently introduced into the economy of various countries to be afraid that due to complete anonymity the states will prohibit it. It is already impossible.

Is there more information available on how CT is supposed to work? Is it a third party service, a second layer, coin mixing or something else?

On a side note, in terms of privacy focussed coins DeepOnion is a nice runner up. Could give Monero a run for its money once the DeepSend functionality is implemented.

I like the idea, but think it might be a bad time to implement it. Wait until mass adoption occurs to eliminate the stereotype that it's for tax evasion and criminals, then add CT. No one will be able to stop it then.

It is not just about that. It is also all the technical difficulties that will come with CT if it does become implemented. In Monero, some people in their community have been annoyed with the fact that CT has made the block size bigger and heavier than they should be.

There is also the problem of technical debt. It would be better to implement it through a hardfork to make the code cleaner. But in my own opinion, it would be best if the community would start using Monero if they really wanted confidential transactions.

CT would result in transactions that are 3 times bigger than standard transactions. I wonder how Blockstream will sell the idea of increasing the max block size to support those bigger transactions.

@odolvlobo. Also what value is there to be had if they implement it by way of a softfork? I reckon it will keep complicating the code and the consequence will be buggy software.

Why not develop bitcoin to do atomic transfers with Monero so we could transfer coins coherently with a cryptocoin that does have CT. It might also develop a nice ecosystem between the 2 coins.

Since it will be on a soft fork will a new alt coin or token be generated from that fork?
Are they doing this to at least boost their prices rapidly like what's happening every time a fork is happening with bitcoin.

Latest developments are that CT's won't need any more additional space than standard transactions if they are coin-joined. And there are possible further optimisations that could improve the specification, the original CT spec used much more space per transaction than this latest set of improvements.

@Carlton Banks. Is that only in theory or do they have supporting code to prove that they have solved the heavier requirements for CT?

Also, can the code be ported back to Monero and, more importantly, maybe to Aeon? I reckon this might be something smooth is looking for to create a lighter version of XMR.