Explaining Privacy Coin To The Non Techies

Blockchain Technology was invented in 2009 and depending on who you ask about this Technology, you would get responses ranging from "Awesome" to "The best thing that has happened to technology in recent times" and I know what you are thinking, I can assure you that I am not exaggerating at all and this Forbes Publication Proves it, Blockchain Technology is here to stay and it is already making a difference, it enables people to make fast, cheap and anonymous transactions to anywhere in the world.

Blockchain is a system in which a record of transactions made in cryptocurrencies are maintained across several computers that are linked in a peer-to-peer network, we can actually have a look at the blockchain and see evidence of what's going on because it is a distributed open ledger system and data entered into the blockchain cannot be altered or stopped by a central authority.

THE DOWNSIDE OF BLOCKCHAIN

As I mentioned above, Blockchain is an open ledger network and can be viewed by anybody and this means that everything in the blockchain is open, every transactions, every wallet, every single details is open to public view, imagine your bank account balance being open to anybody to view your balance and every single transaction you make, if you are rich, that would instantly make you a target for every criminal that wants a share of what you have.

This is exactly what is happening to major cryptocurrency holders right now, their wallets have become targets to every hacker out there who wants to make a quick buck illegally, while Cryptocurrencies ensure that your identity remains anonymous, unfortunately that doesn't stop your wallet from being robbed, A very big example is the 2014 Mt Gox Hack which is regarded as the Biggest Bitcoin Heist which saw a whooping 740,000 Bitcoins carted away by hackers, this hack was the beginning of the end for Mt Gox and there are several instances where Cryptocurrencies has been stolen from various wallets over the years which has made the owners or organisations to go bankrupt.

All these incidents could have easily been avoided if Blockchain transactions and wallets balances were not open for everyone to see because if those hackers could not be certain that those wallets contained large amount of funds, they wouldn't have bothered to hack them. They say information is power and those criminals got the information they needed through one of the main features of blockchain technology.

THE SOLUTION

The reasons mentions above and many more are the reasons why Privacy Coins were finally invented and presently, there are various Privacy Coins in existence and all of them employ one method or another to achieve their aim but all of them effectively ensures that users can make private transactions with blockchain technology.

If I list every single privacy coin in existence and and give brief explanations about them in this article, this article would not end today so I want to list two or three major ones and give brief explanations about them before I explain about Veil which is the newest offering in privacy coin and happens to be my favourite Privacy Coin.

MONERO: Monero is the first Privacy coin to exist and the way it works to cloak transactions is quite simple, Monero simply generates random one-time addresses as the destination address, effectively breaking the link between your public address and the transaction, this is similar to bitcoin mixer, Recipients can use a secret key to scan the blockchain to locate the one-time addresses associated with their account and can also give access to transaction history and balance only to trusted third parties, the down part about this method used by Monero is that with all the data that needs to be stored, scalability had to be sacrificed for privacy.

ZCash: Zcash is quite different from Monero, while all transactions in Zcash is recorded in the public blockchain, the transaction address and amount involved in the transaction are encrypted which ensures that these transactions are truly Private, but to verify that these transaction actually exists, Zcash uses cryptographic zero-knowledge proofs (zk-SNARKs). This cryptography techniques ensure that information can be verified as valid without needing to reveal that information.

DASH: Dash ensures private transactions by mixing several coins with other and this makes it hard to know the origin, The downside to this process is that users will be disclosing their identity to the masternodes mixing the coins, The downside to Zcash’s implementation of zero-knowledge proofs is that they require a special key which if discovered can compromise the whole network.

VEIL: Veil is my favourite Privacy Coin, it features the best technology so far in all privacy coins, while the Privacy Coins all mentioned above have one or multiple weaknesses, Veil is the king of the lot because it combines Zerocoins, Ring Confidential Transactions (RingCTs), (zk-SNARKs) and other innovative technology in a way that ensures that scalability or security is not sacrificed, I promised not to go into any technical explanations in this article so that even a layman can understand it, so just imagine a protocol that combines all the good technology in the above mentioned Privacy Coins without all their weaknesses, the result of this is Veil.

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A BRIEF HISTORY OF VEIL

Veil Cryptocurrency came at a critical time in Cryptocurrency history and while other projects are conducting ICOs in blatant money grabs, The team behind Veil decided to develop the platform without any ICO or Pre-mine and the Veil Blockchain was born in Early January 2019 and since then, Veil has grown both in technology and in users worldwide.