Privacy is extremely hard to come by on the Internet.
Bitcoin itself is not very private right now.Publication of the owner of a single Bitcoin address can yield an incredible amount of personal financial information, information that cannot be put ‘back in the box’ – it will be available forever, encoded into the blockchain. This is the sort of information that law enforcement agencies would typically need to subpoena a bank for; instead right now we offer it to the entire Internet.
We haven’t yet seen significant involvement from consumer privacy agencies at the Foundation, but I believe they will be horrified when they understand just how much private financial data is being broadcast and permanently recorded.
This information directly impacts citizens living under repressive governments. It could cause physical harm to a woman whose finances are controlled by her pimp or her kidnapper. The knowledge of transactions can be combined with violence to limit any human’s fundamental right to transact economically.
It seems therefore critical that we do everything we can to support efforts that enhance this privacy from global inspection. Technological efforts like trustless sharing and ZeroCoin/ZeroCash have potential to improve the privacy guarantees available to those using Bitcoin.
Not everyone will want this kind of privacy to be available. In some jurisdictions, concerns over money laundering are brought up as the reason why such privacy should not be available.
I believe that these concerns are real and valid, and pragmatically, that a balance needs to be struck. We don’t yet know exactly how to balance the risks to different parties; on the one hand direct violence, control of individuals and financial risks borne by citizens with hyper-inflationary money supply are real harms being borne by human beings around the world right now. On the other hand there are real and more generalized harms to society that money laundering enables.
Right now, I believe the most reasonable regulatory approach is to encourage anti-money-laundering and know-your-customer rules that can be implemented at the ‘endpoints’, Bitcoin exchanges or money transmittal businesses. These businesses already have clear regulation and operations rules and understand how to identify money laundering, and what to do about it when they see it.
At the same time, we need to do better protecting those who have no other safe way to transact economically, and the Foundation will be providing support for a variety of proposals as a way to let the broader community engage with them and assess what would be useful.[/quote]
Peter Vessenes, Chairman of the Board Apr 05 2014,
https://bitcoinfoundation.org/blog/?p=679What Darkcoin is doing to create privacy in crypto transactions and in so doing creating eCash:
* Master Nodes These nodes handle the mixing through random selection -
They are responsible for being the authority of what goes into the joined transaction each session.
eduffield, 21 February 2014
https://bitcointalk.org/index.php?topic=421615.msg5282966#msg5282966* I2P:
I'm implementing I2P into the masternodes. We're going to have our own private network just for DarkSend.
eduffield, 10 May 2014.
https://bitcointalk.org/index.php?topic=421615.msg6643662#msg6643662* Ring signatures are going to be implemented in V2.
I will begin development immediately after I opensource V1.
eduffield, 12 May 2014.
https://bitcointalk.org/index.php?topic=421615.msg6686819#msg6686819While ring signatures present their own compatibility problems with the core DarkSend and Master Node network, the lead developer has consider the issues and is seeking to implement adaptations:
Ring Signatures, RC3 Progress Report 22 May 2014
I've had some substantial progress on DarkSend and have figured out how to make our existing system as secure as ring signatures. Vastly improved security, no bloat (from the ring signatures) and without actually having to trust new cryptography (it hasn't been extensively tested like what DarkSend uses) . So I think it'll give us a HUGE advantage in the coming months. More to come soon, I'm going to start implementing this tomorrow.
https://bitcointalk.org/index.php?topic=421615.msg6864666#msg6864666*IP obfuscation 12 May 2014
https://bitcointalk.org/index.php?topic=421615.msg6694377#msg6694377New Features:
*Checkpoints and Spork 26 June
With this launch, we introduced a new soft-fork method, which some users have affectionately dubbed the “spork”. As clients update, new features - Masternode payments, in this case - are implemented and available, though not strictly enforced by the network. After almost all users are updated, the fork can be remotely activated, which would enforce the new feature rules. If successful, the new feature(s) would be permanently activated and enforced. If unsuccessful, enforcement can be deactivated remotely for the whole network without the need for users to update their clients. In the latter case, a checkpoint would be added to put the whole network back on the same chain.
This allows us to test higher risk, innovative features in mainnet without having to hard fork the network and without the risk of a live rollback where all users must update.
https://darkcointalk.org/threads/rc4-development-and-path-going-forward.1604/Is this all legal?
Hell, yes.
Jennifer Shasky Calvery, Director, Financial Crimes Enforcement Network, United States Department of the Treasury, confirms that financial privacy is a real and important aspect of all financial transactions.
The view on regulation is currently being considered in a similar light to Bitcoin. The Bank Secrecy Act and existing AML policies towards digital currency will still apply. In general, moving in and out of fiat requires the use of regulated entities.
Non disclosure of financial transactions on a blockchain ledger is not a reason to stop anonymity tools such as Darkcoin.
https://www.youtube.com/watch?v=M7bbDpwlTws&feature=youtu.be&t=11m48s~12mins
