ZERO-COIN - The Anonymizer , Query..

[spartacusrex]

I am looking at zero-coin and there is something that doesn't seem clear.

I can see that you can do a zerocoin txn and send the coins to the zerocoin mint. Then you can spend that coin but starting from a fresh txn output.

Then your coins are effectively laundered as they have no History. I hope my understanding is correct ?

What I can't see is how do you send the coins to someone ELSE who has no zerocoin txn he has made that he can spend ? The person you are sending to has no money.

Is zerocoin a launder system but not an anonymous transfer system ?

[lexxus]

As per my understanding, zerocoin hides the inputs of transaction (i.e. who send coins), but not the outputs (i.e. who get the coins).

[spartacusrex]

The analogy used in the paper - http://zerocoin.org/media/pdf/ZerocoinOakland.pdf - is that you stick a dollar bill to a pin board. So do many others. You can then go and take a dollar bill from ANY of the dollar bills pinned to the board. ?

This clears the TXN history - but it is KNOWN who pins money to the board and retrieves it. Just not where the dollar came from when you spend it.

[d'aniel]

Is zerocoin a launder system but not an anonymous transfer system ?

Some anonymizing systems are designed to obfuscate links.  For more obfuscation, you need more non-colluding participants for 'cover traffic'.  These participants are known as the 'anonymity set'.

From Wikipedia: "Money laundering is the process of concealing illicit sources of money to make it appear like legitimately earned money."

I imagine if zerocoin were cheaply available, it would be used to ensure legitimate expectations of privacy vastly more often than it would be used for concealing the proceeds of crime (most people are not criminals, and almost everybody would choose to have the extra privacy if it was essentially free).

For this reason I prefer to call them 'mixes' rather than 'laundries', but that's just me...