While with Bitcoin it is possible to increase the degree of privacy of transactions using certain measures, with Ethereum it is practically impossible without using tools such as Tornado Cash. Privacy in payments is an issue that is about to become increasingly important in light of the changes taking place in Western societies.
Tornado.cash Governments are increasingly pushing for the use of credit cards and electronic payments in general. Cash remains the king of anonymous payments, whereas electronic payments are very easy to trace.
Over the years there have been many attempts at creating private transactions on Ethereum. Some workarounds trying to obscure value flows, like using a centralised exchange wallet or a custodial mixing service, however, introduce a high degree of counterparty and surveillance risk.
In the end, these tools never achieved full privacy in the way that other privacy focused cryptocurrencies, like Zcash have. Zcash uses various cryptographic methods including implementations of Zero Knowledge proofs to achieve the privacy functionality.
To Start Trading With Tornado.cash Indian Residents First Have To Sign Up For An Account By Following The Steps Below.
Step 1. Click On The “Login/Signup” Link On The Top Right Hand Corner Of The Tornado.cash Website.
Step 2. In The Form, Fill In Your First Name, Last Name, Mobile Number, Email ID And Password.
Step 3. If You Have A Referral Code, Enter The Code While Creating Your Account.
Step 4. Submit The Form And Wait For An Activation Email To Be Sent To You.
Step 5. Click On The “Confirm Email” Link In The Activation Email.
Step 6. After Your Account Is Activated, You’ll Be Sent A 6 Digit One Time Password (OTP), Which You Have To Enter After Logging Into Your Tornado.cash Account.
How does Tornado.cash achieve privacy in Ethereum?
Tornado improves transaction privacy by breaking the on-chain link between recipient and destination addresses. It uses a smart contract that accepts ETH deposits that can be withdrawn by a different address.
Whenever ETH is withdrawn by the new address, there is no way to link the withdrawal to the deposit, ensuring complete privacy. In this way, Tornado.cash acts as a proxy to ensure that the transaction is 100% anonymous with zkSnarks proofs.
To make a deposit user generates a secret and sends its hash (called a commitment) along with deposit amount to the Tornado smart contract. The contract accepts the deposit and adds the commitment to its list of deposits. Later, the user decides to make a withdraw. In order to do that the user should provide a proof that he or she possesses a secret to an unspent commitment from the smart contract’s list of deposits. zkSnark technology allows to do that without revealing which exact deposit corresponds to this secret. The smart contract will check the proof, and transfer deposited funds to the address specified for withdrawal. An external observer will be unable to determine which deposit this withdrawal comes from.
Use USDC With Tornado
Blec’s aforementioned query was picked up on February 24th by USDC’s Reginatto, who responded on Twitter with a series of comments to provide context on how Circle’s leadership was approaching this nuanced privacy issue.
For context, some cryptocurrency companies have recently moved against users they’ve determined have used mixers, particularly via bitcoin; accordingly, some users in the Ethereum space have been concerned that activities on Tornado might similarly draw ire.
Good for Everyone
It’s not easy to ask the tough questions, but when done in good faith, the results can be extremely productive. Blec’s query to the USDC team and Reginatto’s responses are just one such example.
Furthermore, beyond Blec and USDC, Tornado is a big winner from this episode. A major crypto company just revealed that it had no direct qualms with the privacy tool, which is obviously legitimizing, and other firms may follow suit in kind.
One of Coinworldstory's longest-tenured contributors, and now one of our news,ico,hyip editors, Verna has authored over 6900+ stories for the site. When not writing or editing, He likes to play basketball, play guitar or visit remote places. Verna, to his regret, holds a very small amount of digital currencies.