ㅤ

[witcher_sense]

A thread worth reading for those who are still considering using Wasabi Wallet 2.0 to mix their transactions: https://twitter.com/mHaGqnOACyFm0h5/status/1536442355003293700

A former lead Wasabi developer disclosed some serious vulnerabilities that current Wasabi 2.0 client allegedly has:

> "if your threat model includes making or receiving payments that must not be linkable with other payments under any circumstances, there's a good chance they will be linked on the input side by auto coinjoin, with no recourse. no control over this. in other words although in principle the toxic change problem is no longer inherent to the protocol, and the client could have eliminated it, it chooses not to for no discernible reason.

> "the protocol is basically unfinished, containing numerous vectors for performing targeted attacks on specific coins with deniability or completely covertly."

> "temporal fingerprints are not taken into consideration, though several exist even without assuming an adverserial coordinator."

> "multiple perverse incentives are also provided. for example, you can just modify the client to never pay any coordination fees. if transactions are full, users race each other to register their last inputs, an incentive for yet more temporal privacy leaks on input side."

> "the claimed "orders of magnitude" (i.e. at least 100x) more efficient transactions is dubious at best given the tendency for fragmentation. to mitigate this, various ad-hoc rules have been added to fudge things."

> "the new CEO is aware of these problems, having discussed them with me extensively in private before and after i left. don't believe his lies."


I also found the following article which briefly explains what automatic coinjoins are: https://www.coindesk.com/tech/2020/11/05/wasabi-wallet-20-will-offer-automatic-coinjoins-by-default-to-boost-privacy/

[PrivacyG]

~

So, you are telling me that after Wasabi decides to roll with the anti privacy crew, the 2.0 version of the wallet includes some privacy leaks and flaws.  All of this with the advertisement they are trying to do and all is telling me they are up to something that is definitely NOT respecting privacy and fighting for freedom.  These vulnerabilities are intentionally left to further enhance blockchain analysis.  Change my mind.

I am so glad the majority of their user base seems to be Bitcoin Talk followers.  It was just so easy to get most of the clients off their 'new' surveillance wallet.

-
Regards,
PrivacyG

[dkbit98]

A thread worth reading for those who are still considering using Wasabi Wallet 2.0 to mix their transactions: https://twitter.com/mHaGqnOACyFm0h5/status/1536442355003293700

This is some serious accusations from ex wasabi developer, he even said that wasabi wallet 2.0 is used for nothing more than LARPing  
He also said that he apologies to everyone for contributing to this Wasabi farce

To answer some of his claims posted on twitter, there is public github response to @nothingmuch from Lucas Ontivero:
https://gist.github.com/lontivero/e5223a0aafb31f4250c8bb547acc3f56

Wasabi drama continues...

[n0nce]

A thread worth reading for those who are still considering using Wasabi Wallet 2.0 to mix their transactions: https://twitter.com/mHaGqnOACyFm0h5/status/1536442355003293700

This is some serious accusations from ex wasabi developer, he even said that wasabi wallet 2.0 is used for nothing more than LARPing 

Indeed; so now in short we have:
[1] Wasabi starting to censor certain UTXOs.
[2] No big announcement, and obviously trying to keep it on the low (no website changes).
[3] Confirmation from Wasabi that it is completely voluntary and to be able to work with large investors.
[4] Hideous download numbers since this debacle (~10x lower than before).
[5] Wasabi starting to advertise on Bitcointalk after this and the other threads' high visibility (over 3,000 views as of now!) and dropping download numbers.
[6] Statements from WabiSabi developer that the new software is actually more vulnerable to deanonymization.

[1] https://twitter.com/wasabiwallet/status/1503091503207432193
[2] https://wasabiwallet.io/
[3] https://blog.wasabiwallet.io/zksnacks-blacklisting-update/
[4] https://tooomm.github.io/github-release-stats/?username=zkSNACKs&repository=WalletWasabi
[5] https://bitcointalk.org/index.php?topic=5401963
[6] https://twitter.com/mHaGqnOACyFm0h5/status/1536442355003293700

Wasabi drama continues...

I'd call it a Wasabi Saga at this point and can't wait to see it continue unfolding, watching from the sidelines.

[icopress]

[5] Wasabi starting to advertise on Bitcointalk after this and the other threads' high visibility (over 3,000 views as of now!) and dropping download numbers.

This statement is not true, as I have already said that the signature campaign was approved at least a month before the events discussed here. In addition, as far as I know, the site will be updated in the very near future (this week). Anyway, I already have a bbcode ready for the OP (briefly about the main + I asked for materials explaining how to switch to another coordinator, or set up and run your own).

[NotATether]

[4] Hideous download numbers since this debacle (~10x lower than before).
[4] https://tooomm.github.io/github-release-stats/?username=zkSNACKs&repository=WalletWasabi

Note that this only counts downloads from the Github Releases page, and Wasabi Wallet can move the binaries to their own website at any time to hide the download stats, say if they didn't want them to be used against them in the news.

[n0nce]

[5] Wasabi starting to advertise on Bitcointalk after this and the other threads' high visibility (over 3,000 views as of now!) and dropping download numbers.

This statement is not true, as I have already said that the signature campaign was approved at least a month before the events discussed here. In addition, as far as I know, the site will be updated in the very near future (this week). Anyway, I already have a bbcode ready for the OP (briefly about the main + I asked for materials explaining how to switch to another coordinator, or set up and run your own).

Correct; then my timeline is a bit off.
Website update should have happened with / before the announcement though, in my opinion.

It's good that you asked them about running custom coordinators and such, but they should have provided info and GUI for switching coordinator before starting the blacklisting / Wasabi 2.0, even without pressure from community members such as yourself.

Besides the fact that a few posts up Leo described that even with custom coordinators, it will never be decentralized and a whole architecture rework would be needed to make it resilient to 'alternative coordinators' going rogue.

The whole implementation of Wasabi coinjoin depends on connecting to a single centralized coordinator.
[...]
Anyone else in the world can spin up their own coordinator if they wanted, but there are two main issues with that. Firstly, the liquidity on your coordinator depends on how many users connect to it. If no one else connects to your coordinator, then you have no one to coinjoin with. Secondly, your coordinator is still centralized. It might be owned and operated by someone other than zkSNACKs, but it is still owned and operated by a single entity.

It would take a redesign of Wasabi to implement a decentralized coinjoin, such that every user effectively runs their own coordinator which then communicates with everyone else's coordinator. Given that this is never going to happen, then the better option is to switch to JoinMarket instead, which does pretty much this, and communicates directly with other JoinMarket clients peer to peer rather than via a centralized coordinator.

[4] Hideous download numbers since this debacle (~10x lower than before).
[4] https://tooomm.github.io/github-release-stats/?username=zkSNACKs&repository=WalletWasabi

Note that this only counts downloads from the Github Releases page, and Wasabi Wallet can move the binaries to their own website at any time to hide the download stats, say if they didn't want them to be used against them in the news.

Sure; but for now we do have the information. It's possible that for whatever reason less people updated their software than before the announcement or that download numbers fell because of another reason, but it's definitely a fact that they're indeed lower than before.


I also just noticed the website (front page) has changed. But the docs page wasn't and these quotes that Leo pulled out are still contradicting what they're doing right now since the blacklist update.

It is disgusting enough that they are now anti-bitcoin and pro-censorship, but to add more insult to injury, they continue to blatantly lie in their advertising, and their website still includes such incredibly hypocritical statements such as this one:

The aim of bitcoin is to be a decentralized digital currency, but if all users are eventually required to consult centralized blacklists before accepting bitcoin, then its decentralization will be destroyed.

Wouldn't it be horrendous for your wallet to have to consult a centralized blacklist before allowing you to coinjoin your bitcoin. Right!?

Or maybe this one:

If Bitcoin fungibility is too weak in practice, then it cannot be decentralized: if someone important announces a list of stolen coins they won't accept coins derived from, you must carefully check coins you receive against that list and return the ones that fail. Everyone gets stuck checking blacklists issued by various authorities because in that world we'd all not like to get stuck with bad coins. This adds friction and transactional costs and makes Bitcoin less valuable as money.

So by their own admission, they are working to make bitcoin less valuable as money.

And of course, absolutely no mention on their website that they are cooperating with blockchain analysis and censoring their users. In fact, they strongly imply that they are not doing such a thing here:

The only known possible 'malicious' actions that the server could perform are two sides of the same coin;

• Blacklisted UTXO's: Though this would not affect the users who are able to successfully mix with other 'honest/real' peers.

[witcher_sense]

I also just noticed the website (front page) has changed. But the docs page wasn't and these quotes that Leo pulled out are still contradicting what they're doing right now since the blacklist update.

And of course, absolutely no mention on their website that they are cooperating with blockchain analysis and censoring their users. In fact, they strongly imply that they are not doing such a thing here:

Okay, I found an updated version of their privacy policy where they mention "coin filtering"

Coin Filtering

    zkSNACKs Ltd. may execute illicit activity checking and control via a contracted third party solely in its coinjoin coordination services. zkSNACKs Ltd. may suspend your UTXOs’ access to the coinjoin services, with immediate effect for any reason - including but not limited to illicit or prohibited activities, applicable sanctions programs, or any crime or money-laundering activity - at its sole discretion and is under no obligation to disclose the details of its decision to take such action with you. In this case you are not permitted to use the relevant/high-risk bitcoin UTXO to reach the coinjoin services.
    You acknowledge that zkSNACKs Ltd.'s decision to take certain actions, including suspending for any reason at our sole discretion, may be based on confidential criteria that are essential to zkSNACKs Ltd.'s risk management and security protocols. You agree that zkSNACKs Ltd. is under no obligation to disclose the details of its risk management and security procedures to you.
    Your access with the relevant bitcoin UTXOs to the coinjoin services will be permanently suspended.

[dkbit98]

Besides the fact that a few posts up Leo described that even with custom coordinators, it will never be decentralized and a whole architecture rework would be needed to make it resilient to 'alternative coordinators' going rogue.

I don't know why do I get the feeling that this guy and some of his developer friends will soon create some fork of Wasabi wallet with new name and branding.
Maybe they want to roll back and use code base of older Wasabi version with some improvements, because they obviously think that 2.0 version is unfixable.
I am not going to take any sides, but I think we are going in wrong direction that is opposite from better bitcoin privacy,

[OROBTC]

...

And, we're off...

Bitcoin Magazine's Shawn Amick writes up some comments on Wasabi's Wallet 2.0:

https://bitcoinmagazine.com/business/wasabi-wallet-2-contains-new-features-for-optimizing-bitcoin-coinjoins

Note that he does not even mention that Wasabi is working with analysis companies....

[n0nce]

I also just noticed the website (front page) has changed. But the docs page wasn't and these quotes that Leo pulled out are still contradicting what they're doing right now since the blacklist update.

And of course, absolutely no mention on their website that they are cooperating with blockchain analysis and censoring their users. In fact, they strongly imply that they are not doing such a thing here:

Okay, I found an updated version of their privacy policy where they mention "coin filtering"

Coin Filtering
[...]

Right; but the docs pages should all be updated, too. They all still (correctly) say how fungibility is important and how blacklisting is bad and such.
There's no chance one of their users will look into a deep subfolder of their GitHub repository. It should all have been done long ago, even prior to the change, saying 'from [date X], this will come into effect: ...'.

Besides the fact that a few posts up Leo described that even with custom coordinators, it will never be decentralized and a whole architecture rework would be needed to make it resilient to 'alternative coordinators' going rogue.

I don't know why do I get the feeling that this guy and some of his developer friends will soon create some fork of Wasabi wallet with new name and branding.
Maybe they want to roll back and use code base of older Wasabi version with some improvements, because they obviously think that 2.0 version is unfixable.
I am not going to take any sides, but I think we are going in wrong direction that is opposite from better bitcoin privacy,

That's not likely, in my opinion. Leo is pointing out obvious issues (like everyone else here) and I don't even know if he's a developer. He actually correctly pointed out that providing other coordinators ('just renaming / rebranding Wasabi') is not a good idea; that the protocol and the whole architecture should work in a decentralized matter and not with such 'single point of failure' coordinators.

The old Wasabi code isn't any more decentralized.

If someone (o_e_l_e_o or someone else) comes forward with a Wasabi fork that completely removes the coordinators and employs a network similar to Bisq, then I'm all for it! I'd love to see more competition / innovation / options to choose from in this space!

[...]
Note that he does not even mention that Wasabi is working with analysis companies....

Putting that investor money to good use! No seriously, these 'crypto news sites' (also other news sites) are doing such bad journalism; they basically became simple ad bullhorns that can just be bought out instead of actually researching a topic / claims / a product / company and having a deeper look. At that point I don't even know why people read that stuff if they can just read the adverts on the company webpage. What's the point of a journalist that just repeats company claims without scrutiny? I digress - let's stay on topic.

[o_e_l_e_o]

Okay, I found an updated version of their privacy policy where they mention "coin filtering"

Won't even call it for what it is - censorship. Pathetic.

The paragraphs above the ones you've quoted are quite revealing too. Things that Wasabi will censor you for include (but are by no means limited to) anything infringing on copyright laws, anything related to scams, and anything sexual. Who gets to decide on that? We don't know, because again they hide behind the words "contracted third party" instead of being honest and naming a specific blockchain analysis firm. CSW has copyrighted the whitepaper in some jurisdictions. Will Wasabi censor me if I try to pay for my hosting of the whitepaper? Some people think bitcoin is a scam and some banks stop people from buying bitcoin. Now Wasabi is doing the same thing to bitcoin users? And regardless of your personal views on porn, it is perfectly legal in most jurisdictions and yet still Wasabi are censoring it. What about if I want to buy some lingerie for Foxpup my wife? Is that censored too? How long before other perfectly legal things like gambling show up on that list too?

And of course all this is buried in legal documents that 99% of users won't read. The Privacy Policy link on their main page helpfully leads to a 404. And still absolutely no mention anywhere on their main site, but plenty of blatantly false and contradictory statements such as:

What you do with your bitcoin is your business.

Unless it's something we don't like.

The wallet uses WabiSabi, an anonymous credential scheme that was designed to enable more accessible and efficient coinjoins.

So accessible that we prevent people form accessing it.

[witcher_sense]

[…]

"Privacy is your ability to selectively reveal yourself to the world," says the Wasabi Wallet website's front page. But I would also add: "The main purpose of Wasabi Wallet is to selectively provide services arbitrarily deciding who has the right to selectively reveal themselves to the world and who does not."

As part of their marketing strategy, they offer zero coordinators fees if coins fall into certain criteria. Namely:

* Coins coming from a WW coinjoin (remixes)
* Coins with value < 0.01btc
* Coins coming with a WW coinjoin ancestor (only one hop)

And I am wondering... How else can they determine if certain UTXOs came from a specific source than by cooperating with a chain surveillance firm that is actively analyzing blockchain to provide them with required data?

[NotATether]

Things that Wasabi will censor you for include (but are by no means limited to) anything infringing on copyright laws, anything related to scams, and anything sexual.

Copyright infringement is perhaps the biggest problem on this list because the criteria for copyrighted data is fuzzy!

Say you pay Valve some BTC for some AAA title using the Wasabi Wallet, later it is discovered that the developer of the AAA title stole some graphic assets from another developer, and if DMCAs and LumenDB are anything they go by, Wasabi will quickly censor your transaction before it can even happen (even though you had nothing to do with the infringement!)

Here is a more practical and dangerous example: Imagine you are buying subscriptions for a site, but you can't because the big motion picture association trolls sent a DMCA notice to the site because it happens to have an illegible sequence of bytes that are related to DVDs?

And then, here too, Wasabi decides to "voluntarily" censor those transactions that are violating copyright i.e. DMCA.

[PrivacyG]

Here is a more practical and dangerous example: Imagine you are buying subscriptions for a site, but you can't because the big motion picture association trolls sent a DMCA notice to the site because it happens to have an illegible sequence of bytes that are related to DVDs?

And then, here too, Wasabi decides to "voluntarily" censor those transactions that are violating copyright i.e. DMCA.

Let me tell you something even worse.  Once you start censoring, you will inevitably progressively censor things you were not supposed to censor in the first place.  This is a precedent.  Once you said yes to coin 'filtering' for three reasons that were deemed suspect or 'illicit', it gets SO much harder to say no to 'just one more' reason to censor for.

I can easily imagine someone fighting against censorship straight from the start and successfully saying 'no' to censorship but I can hardly imagine someone pretending to fight against censorship in the beginning, jumping in the surveillance boat, willing to censor 'just a few very bad things' and then successfully saying 'no' to one more 'bad thing' to censor.

At this point.  Once the 'filtering' starts it is just so easy to be a targeted attack.  Think exchanges asking you for KYC due to 'suspected origin of coins'.  They never share proof of origin of suspicion, do they?  They share no proof but they ask you for a lot of it.  Wasabi can ban you and you will never even know why you were 'filtered' in the first place.  All of it just because some big boy told them you are bad.

-
Regards,
PrivacyG

[BlackHatCoiner]

All of it just because some big boy told them you are bad.

And let's not forget bribes. Now that they're officially cooperating with chain analysis companies, it's rational to conclude they'll follow their rules as well. Does a blacklisted output want to get mixed? Sure, no problem. Take those sats and insert our 10 outputs, thinking they're coinjoining privately; let's follow their activity afterwards.

Mixing with Wasabi suddenly feels like you've got something to hide. Better go with JoinMarket and ChipMixer.

[o_e_l_e_o]

Once you start censoring, you will inevitably progressively censor things you were not supposed to censor in the first place.  This is a precedent.  Once you said yes to coin 'filtering' for three reasons that were deemed suspect or 'illicit', it gets SO much harder to say no to 'just one more' reason to censor for.

I've said this several times before, including in this very thread: https://bitcointalk.org/index.php?topic=5286821.msg60219453#msg60219453

Bitcoin is either censorship resistant, or it isn't. Anyone saying "Well, I'm not being censored" is entirely missing the point. If Wasabi can choose to censor some coins, then they can choose to censor any coins. If someone can be censored, then you can be censored. As soon as an entity (Wasabi) has the ability to pick and choose who is and is not allowed to spend their money in certain ways, then your system is centralized, is not private, is not censorship resistant, and is not free. This is what Wasabi have created here.

The list of things they have admitted they will censor for is bad enough. It won't be long before that list grows, and there will definitely be other things not on that last that they will censor for and just not tell anyone about.

I'm also interested in the scenario (which will definitely happen sooner or later) where someone is allowed to mix their coins and then afterwards Wasabi decide that their inputs were tainted and they shouldn't have been allowed to mix them at all, since the document linked to above also invites you to inform them of any illegal transactions and states that they will fully cooperate with any investigations. Why would reporting an illegal transaction to Wasabi achieve anything at all, unless they have the ability to track those coins and are going to share that information with law enforcement?

[dkbit98]

If someone (o_e_l_e_o or someone else) comes forward with a Wasabi fork that completely removes the coordinators and employs a network similar to Bisq, then I'm all for it! I'd love to see more competition / innovation / options to choose from in this space!

It's possible, but not so easy to create in reality.
Bad comments and criticism about new 2.0 wasabi I saw was ere coming from ex wasabi developer @nothingmuch so I was talking about him, and I am sure there are more like him.
Let's see how everything will work now, maybe we can use wasabi in some cases and test if it's working with coins coming from mixers and gambling, or it will be rejected.
It's something like litmus paper test for coins

Putting that investor money to good use! No seriously, these 'crypto news sites' (also other news sites) are doing such bad journalism; they basically became simple ad bullhorns that can just be bought out instead of actually researching a topic / claims / a product / company and having a deeper look.

It's true, but I think that owner of bitcoinmagazine has some good articles, apart from his long term cooperation with wasabi.
I still think bitcoinmagazine is way above crypto yellow papers like Coitelegraph or Coindesk.

I'm also interested in the scenario (which will definitely happen sooner or later) where someone is allowed to mix their coins and then afterwards Wasabi decide that their inputs were tainted and they shouldn't have been allowed to mix them at all, since the document linked to above also invites you to inform them of any illegal transactions and states that they will fully cooperate with any investigations.

Question is will other centralized exchanges now accept coins coming from Wasabi wallet, or they will add second layer of censorship on top of Wasabi  

[icopress]

Let's see how everything will work now, maybe we can use wasabi in some cases and test if it's working with coins coming from mixers and gambling, or it will be rejected.
It's something like litmus paper test for coins

Great idea! I'll probably build a review campaign based on this idea.

[electronicash]

would you recommend wasabi to someone who are not really up to censor anyone or someone who wil eventually want to send his coin to an exchange?

it does really have a good feature for privacy, this is useful but could also backfire when youre about to sell for profit because the exchanges may potentially freeze your coin.