Money Is Privacy Or A Surge For Exclusive Access
By Nick Avramov on ALTCOIN MAGAZINE
I would like first to start with a Bitcoin-related Internet folk story that happened about six years ago. I am not sure it’s the original post, though I haven’t found any sort of earlier version.
For those of you unaware, it was a post on Reddit describing the so-called time-traveler from the future. He or she describes a “bright future” in which the Bitcoin economy succeeded, but not in a way enthusiasts had tried to predict it. Instead, most governments no longer exist, economic growth is about -2% per year, the only thing that prevents the world from collapse is the fact that there are still new bitcoins to be mined.
There’s one thing from that folk story that haunts me — the problem that arises from being totally transparent in terms of wealth possessions. In a story above, Winklevoss twins — well known early adopters of the technology — were among the first to suffer from various terrorist groups (it’s put another, the more terrific way in the story of time-traveler). Let’s call it the privacy problem.
Indeed, for many times there come some thoughts like — why preserve privacy if I’m not doing anything bad?
It’s not like only because some criminals may find you a perfect target for malicious actions — let it not happen — it’s because it should be stated as a universal and inalienable right, especially in terms of financial things.
Look, you might say, what about criminals? What about a nightmare of AML policy officers and etc?
There’s indeed a thin border between financial privacy and malicious activity thanks to a vivid memory about Ross Ulbricht and the Silk Road, let alone other crimes made with the use of crypto. However, I believe that the controversy might be resolved on the stage of enforcement and legal parties, without mixing up outdated rules and advanced technologies. I have in mind several situations when financial privacy must be preserved and privacy-focused coins seem like a good solution for that.
Let’s take a look:
B2B Confidentiality
There exist lots of companies that accept and store cryptocurrencies, and they are the first candidates to make use of privacy-focused coins. For instance, if a business accepts payments in Bitcoin from several clients using the same bitcoin wallet address, those parties can see the number of bitcoins that the business receives and determine how much others pay. This, in turn, ruins the business model at all. No business would exist under such conditions.
In case this company switches to private cryptocurrencies, the transactions cannot be viewed by third parties, and that very thing will avoid potential problems in the pricing policy, both with suppliers and customers.
Empowered Personal Security
Wealthy people, especially crypto millionaires have their own problems: their digital wealth is visible on the blockchain for anyone, and any of their wallets can be associated with their personal data. This creates enormous personal risks. And there’re indeed cases when the like persons were under attack from betrayers or criminals. Again, privacy coins might be a good solution to that.
Freedom of Financial Expression
When the Edward Snowden Fund began accepting donations in Bitcoin, the US authorities outlawed it. This practically did not affect their number in any way, but if the Fund asked for donations in private cryptocurrencies, then no citizen worldwide put herself at risk of liability for breaking the law.
Financial Sovereignty
Finally, a truly anonymous digital currency that is resistant to censorship allows people to achieve full financial sovereignty.
Again, governments become more strict in terms of how they aim to control their citizens. Chinese scoring system to be named at least. These raids on people’s privacy (not saying about the cases when it preserves social security) violate the very essence of individual how it’s conceived in international law, and thus privacy-focused currencies might be a solution.
That’s basically what yields inner impulse to privacy coins like Monero, Zcash and other I considered last year. Or more precisely CUTcoin — the first privacy-focused coin based on Proof-of-Stake consensus protocol. As I am engaged in it for a while, I would be pleased to answer any question one might have.
The opinion of the author may not coincide with his point of view.
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