tag:blogger.com,1999:blog-6704573462403312459.post6529968900371235194..comments2024-03-28T06:53:23.473-04:00Comments on Moneyness: DeFi needs more secrecy, but not too much secrecy, and the right sort of secrecyJP Koninghttp://www.blogger.com/profile/02559687323828006535noreply@blogger.comBlogger3125tag:blogger.com,1999:blog-6704573462403312459.post-83042436925837875332022-01-31T23:38:42.506-05:002022-01-31T23:38:42.506-05:00"To make their tools palatable for Main Stree..."To make their tools palatable for Main Street, DeFi tool makers will have to unwind some of the native anonymity (potentially) afforded by blockchains by collecting and verifying identifying information from users. This way the tools can screen out criminals, assuring legitimate businesses that their clean funds aren't being tainted by dirty money."<br /><br />I'm not really sure if that's honestly feasible. Typically that sort of practice traditionally has to be managed by a trusted third party who manages privacy records on the behalf of their users. Having privacy that can be turned on or off willy nilly by a centralized entity seems anathema to the functioning of DeFi. You could theoretically go halfway with it by implementing privacy protections that are labor intensive to dig through but still feasible to find, but that's already kinda the case with even the traditionally transparent blockchains like Bitcoin. When considering how new addresses can be made, cold storage wallets can be swapped in the real world, the sheer volume of transactions, etc its typically not particularly easy to find people who want to stay hidden while using transparent chains even when taking into account chain analysis software.<br /><br />At best you could trace at the point of exchange from fiat to crypto, but good luck enforcing regulations on crypto to crypto transactions. Especially if there's a future where all crypto transactions are low fee and fast, it'd be a complete nightmare to try and enforce AML compliance on a market where people can own any crypto wallet not directly tied to their identity.<br /><br />Of course if you *did* create a DeFi crypto currency where real world identities were tied to addresses universally you'd basically have non-existent privacy. Solutions to introduce some mid level amount of privacy like hiding transactions for most people would require hiding the blockchain as well except for law enforcement, for who there's not really any decentralized algorithm that can cater to them.<br /><br />On a fundamental level, the sort of halfway privacy you envision isn't really possible without severely compromising the decentralization of DeFi. Its more or less an all or nothing affair between Bitcoin transparency and Monero privacy. This is reflected in market share, where typically the more absolutist approaches of Monero's privacy outperform its somewhat privacy focused peers.<br /><br />In the end though, isn't traditional paper cash a fairly decent counter-argument against the notion that compliance to law enforcement requests is a necessary pre-requisite to large scale adoption and usage? Paper money is still by far the most popular method of conducting dirty money laundering or other such business, and it sees plenty of mainstream use nonetheless.Rothnoreply@blogger.comtag:blogger.com,1999:blog-6704573462403312459.post-90650233653154600382022-01-30T06:28:10.999-05:002022-01-30T06:28:10.999-05:00Does JPM Coin offer a certain type of secrecy to i...Does JPM Coin offer a certain type of secrecy to its users? It probably does, since it worked with Zcash back in the day on zero knowledge proofs. JPM Coin is being used for intraday repo right now, so it's very important for participants to have a degree of privacy from both each other and JP Morgan, since they won't want their trading strategies to be anticipated.JP Koninghttps://www.blogger.com/profile/02559687323828006535noreply@blogger.comtag:blogger.com,1999:blog-6704573462403312459.post-76576493786759254002022-01-30T01:18:47.108-05:002022-01-30T01:18:47.108-05:00What if he gets a JPM Coin loan which he can pay b...What if he gets a JPM Coin loan which he can pay back for the same amount of JPM Coin, or dollars plus interest? What if his suppliers accept JPM Coin too? Can JPM make all the transaction info opaque to all but them? How much of a dollar premium would you pay for JPM Coin?rsmhttp://subbot.orgnoreply@blogger.com