This is an opinion piece by Theo Goodman of NYM Technologies
May 1, 2020 – Before the current COVID global pandemic, people were already concerned about privacy – the Cambridge Analytica revelations on data collection, people deleting Facebook, and using Tor to visit certain websites that they normally would not with a normal browser. Now, with governments stating that they are tracking us, for “our own good”, the immediacy and relevancy of privacy is hitting home for many, more than ever. The question remains, is privacy something that people are willing to pay for?
Privacy Coins
Historically, privacy has been a top issue in the crypto scene – from the proposed white-listing scheme by ex-Bitcoin core developer Mike Hern, to several altcoins with privacy features such as Dash (previously called Xcoin, Darkcoin), Monero, and Zcash. While all of these tackle some of the issues of on-chain privacy, Dash and Zcash are not by default private. Since all three are separate networks, it is not hard to derive those who may be using them, taking a small group of people and dividing them into even more small groups making it easier to spot who is using that network. If only a few people are using your privacy shitcoin, it is not hard to figure out who is using it.
Privacy is undervalued
Even in clear contradiction of most Austrian economic theory, and what seems to be against Gresham’s law, these coins do not seem to go away; and one reason is that people are willing to pay for privacy. In the example of privacy coins, they might not pay an extra fee for privacy directly, but they pay in the currency risk of price volatility, while holding the privacy coin and exchange fees buying and selling the coin.
Coin Join
Bitcoin does not have privacy built into the codebase. To achieve on-chain privacy there is a technique called Coin Join. This is not the same as old school “mixers” from the dark web that simply took your bitcoin and gave you some different bitcoin, but instead mixes tiny parts of bitcoins and joins them. Join Market, Wasabi Wallet, and Samourai Wallet – all have users that want to coin-join pay fees. More evidence that users are willing to pay for privacy.
Tragedy of the commons or Tragedy of the incentives?
Tor
Most people have heard of Tor, and more and more people use Tor than ever before. We think of it as a given, that it works well and is available to use, like water is available to drink. Right now, the only incentive to run a Tor node is ideological ~ to pay for others’ privacy, or if you are a Global Passive Advocary and want to know what is going on in the Tor network.
Even though Tor is free to use for most, someone is paying, someone is willing to pay for it. All the people and entities that run nodes are paying for you to be able to use Tor, there is no ‘free lunch’, even if you try to hide. While Tor does give you some network-level privacy, it is not able to give you privacy from a Global Passive Adversary such as the NSA. Even though someone is paying for your privacy when you use Tor, the network is not scalable. The amount of Tor users has been going up, while the amount of nodes has stayed about the same. Since there is no economic incentive to run a node, it is hard for Tor to “scale”.
Mixnets can make it impossible for a Global Passive Adversary to harvest the much-needed metadata on the packets going into and out of the network. A combination of cover traffic, dummy packets and timing obfuscation all improve the user’s privacy to stop the leakage of your precious metadata.
What if you could use a mixnet that allowed for high-level network privacy? Would you send messages, cryptocurrency transactions, and other files via a Mixnet? Would you pay for using such a network? Would you like to earn, running a node and being part of the mixnet? NYM is working on an incentivized Mixnet. Currently, the ‘testnet’ is live, without any incentives, but you can already mix packets, right now.
It´s my privacy I can do what I want to do
Conclusion
Everyone wants privacy, an elusive concept and a fervent reality, now more than ever before. Whether that be how often you use the toilet, what websites you visit or with whom, how much, how hard, and when you use bitcoin or use your place in this hardened world, you are you, you are here, all of us individuals and all of us connected.
People want privacy. The companies and governments that are harvesting your data have a huge war-chest. Are you willing to pay for privacy and the development of privacy tools that can check the power of the entities that have been harvesting your data before you even knew it was there? Re-read this piece and ask yourself, what is life without a little mystery? We need truth as much as we need privacy. The two are not counter-intuitive. We are here, we are making shit happen, and we need protocol in place to define our NOW: privacy and provocation, we demand more.
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