In recent years, the use of anonymous cryptocurrencies has increased drastically in the online gambling industry. Dealing in cryptocurrencies has become more popular as the need for privacy online has become more evident. In response to the tracking companies founded to counteract the anonymous nature of currencies like bitcoin, ZCoin claims to be able to give users complete privacy.
How ZCoin Achieves Total Privacy
ZCoin was created by Gary Le and Poramin Insom, and it offers a level of privacy that no other cryptocurrency on the market is currently able to offer.
The creators claim that it will enable complete privacy across its distributed ledger. It also amplifies the level of anonymity by using Zero-Knowledge cryptographic proofs in the blockchain. This is important because many of the recent tracking software start-ups are able to track transactions through multiple blockchains.
One of the developers of ZCoin, Gary Le, spoke with Bitcoin.com to explain how their Zerocoin Protocol works, and why it is so different from all other approaches on the market today. He says that one thing that sets ZCoin apart from other cryptocurrencies like bitcoin is that all of the data tethered to both the recipient as well as the sender is completely unattainable. Other cryptocurrencies that claim to provide an anonymous platform for transactions use much simpler methods like tumbling or heuristic approximations of the threat model. This means that any hackers, blockchain crawlers or third parties with the right resources can still track the transaction history of anyone they choose.
ZCoin actually operates on a modified version of the bitcoin database; this is where the "Zero-Knowledge proofs" come in to play. To illustrate the power of these proprietary proofs, the developers cite "Yao's Millionnaire's Problem" to help explain that Zero-Knowledge proofs would allow someone to create a solution to that problem.
Other Perks Of ZCoins
Unlike most digital wallets and cryptocurrency databases, including bitcoin, ZCoin does not even track wallet IDs. This means that there is no link to senders or recipients of ZCoin, thereby increasing anonymity. While bitcoin does track wallet IDs, it's important to note that this information alone cannot be used to find personal information.
ZCoin's release has been highly anticipated, especially by online casino players, because it offers one of the most secure payment methods possible for depositing and withdrawing funds.
Jamie Redman, ZCoin Launching Soon: Promises Full, Untraceable Anonymity news.bitcoin.com, September 18, 2016