Privacy coin

A privacy coin is a cryptocurrency that hides some or all transaction details: the sender, the receiver and the amount. In Bitcoin, every transaction is visible on the public blockchain; privacy coins make that information unavailable to outside observers.

How they do it

• Monero (XMR) uses ring signatures, stealth addresses and confidential transactions (RingCT). Privacy is on by default for every transaction.
• Zcash (ZEC) uses zero-knowledge proofs (zk-SNARKs). Shielded transactions are optional: Zcash also has transparent addresses that work like Bitcoin's.
• Several newer projects are built on Monero's codebase, for example Zephyr and Salvium.

Regulation

Because their transactions are hard to trace, privacy coins draw regulators' attention, and some exchanges have delisted them in certain countries. Before mining or buying one, check whether the exchanges you use support it.

See also

• Monero
• Zcash
• Zero-knowledge proof
• Delisting