Monero, majorly known for its privacy is in news for a flaw in this ostensibly untraceable currency. The entire history of Monero being embedded in its blockchain is now called the semi-vulnerable method. This might possibly mean that the transactions that happened years ago could potentially be analyzed for data of the entities involved.
A team of researchers from Princeton, Carnegie Mellon, Boston University, MIT, and the University of Illinois recently released a paper which contained information about Monero. The team is designed to mix coins in each transaction with decoys called ‘mixins’.
This is where the flaws lie and this is how the trick works:
Simple tricks allow an observer to distinguish some decoy mixins which are used to cover a real coin that is being spent. Monero had initially permitted users to opt-out of the privacy protections and spend coins with no mixins at all. The problem with this kind of an opt-out system is an already spent and identified coin is later covered as a mixin making it easy to pluck out and identify the remaining coins.
Another flaw is related to the timing of transactions. When there are a bunch of real and fake coins in a transaction, the real one will probably be the most recent coin moved prior to the transaction. Until the Monero’s developers made changes recently, the timing analysis did correctly identify the original coin at least 90% times. This virtually nullified Monero’s privacy safeguards.
According to an estimate from the researchers, a maximum of 25% of XMR transactions are illicitly used. This still accounts for a huge chunk of activity on the coin’s network. These flaws might not necessarily reflect close to the illicit transactions traced but they do undermine XRP’s security.
Monero’s Core Developer, Riccardo Spagni told Ripple:
“Privacy isn’t a thing you achieve; it’s a constant cat-and-mouse battle.”
Monero has had an increase of 4.36% with its value currently stands at $195.40 as seen at press time.
Riccardo also quoted:
“There are steps we can take to continue to improve the sampling, but the reality is that this isn’t a solvable problem by just pecking away at it.”
Daniel Larimer writes on Twitter:
“Yet another example at how privacy is largely a temporary illusion. Don’t rely on privacy coins to skirt laws or taxes.”
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