Contents

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Alternatives to Bitcoin
1
Course Introduction
PREVIEW1m 16s
2
Litecoin
PREVIEW4m 4s
4
Ethereum
6m 46s
5
Ripple
12m 22s
6
Steem
4m 1s
8
Monero
7m 18s

The course is part of this learning path

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Description

The most well-known cryptocurrency is BitCoin, but in this course, we will introduce you to some other alternatives out there in the cryptocurrency ecosystem. These include Litecoin, Binance Coin, Ethereum, Ripple, Steem, Ethereum classic, and Monero.

Transcript

Welcome to this lecture. In the course where we're going to be discussing Monero and explaining it's three major anonymity methods with you. So, following Monero launch in April 2014, it has progressed slowly and steadily for the most part to claim its place along the major cryptocurrencies. Monero has played the long game being the tortoise rather than the hare. At least until Monero jumped up and started sprinting in August of 2016. Now besides being accessible through dark net networks such as I2P and Tor, Monero integrates several sophisticated cryptographic techniques to achieve an impressive level of overall privacy. So, let me go over the three major anonymity methods of Monero with you now. One, unlinkable stealth addresses. Address reusage is one of the most common privacy bugbears of Bitcoin, receiving multiple payments to a single address allows anyone who knows your address to track its balance and all related incoming and outgoing transactions. What's worse is that even separate addresses in your wallet may become linked due to the way Bitcoin handles change. For this reason Bitcoin core developer Luke Dashjr said that only a fool would use Bitcoin as it is today for dark net purposes. No such privacy issues exist in Monero. All destination addresses are obscured within its Blockchain such that only the sender and receiver can identify them. Analysis of the Monero Blockchain will never reveal the destination address at which one receives XMR. Instead only a cryptographic hash of the destination unique to each and every transaction is visible. Only the sender or receiver can decode this to reveal the actual address. These obscure addresses are known as stealth addresses. Beyond the obvious privacy benefits, stealth addresses have a number of ramifications such as making it impossible to determine the current XMR distribution among addresses. You can verify this yourself by putting a publicizing Monero address which likely contains some XMR, into the Monero Blockchain Explorer. Two, indistinguishable separated transaction units. If you were to send XMR to an address in reality the encoded stealth address described previously it would arrive as several discrete payment units. For example if you were to send 18 XMR it would arrive in whole number units of 10, 5, and 3 XMR totaling 18. Each unit would appear on the Monero Blockchain as being transferred to it as its unique and distinct stealth address. This same process is applied to any change which is returned to the sender and any fees paid to miners. This property makes the task of tracking specific payment amounts vastly more complicated. As an example an adversary who knows of vendors product costs, an unusual amount, let's say precisely 11.88101234 XMR could conceivably monitor the Blockchain likely via some automated process for the amount appearance and then focus their analytic techniques on resources on those related transactions. By sorting all transactions into unremarkable units, the Monero system ensures otherwise distinctive sums are lost in the crowd of undifferentiatable whole units. Three untraceable ring signature payments. There's a definite synergy between the way Monero handles addresses and payment amounts. This third technique, ring signatures is another neat piece of cryptographic engineering, which makes it even harder for a Monero user to be identified. Ring signatures are essentially advanced mandatory system for transaction mixing. In order to understand ring signatures, it's necessary to understand that as a Bitcoin, a Monero address is essentially a specialized form of cryptographic public key. Funds associated with that address may only be moved through the use of its paired private key. To continue the earlier example, you send 18 Monero to a shop, this transmission then gets subdivided into 10, 5, and 3 Monero streams, all of which flow to separate stealth versions of the shops Monero address. Here is where ring signatures come into play. From the point of view, from an adversarial shocker the private key which authorized any 10, 5, and 3 XMR sums ever sent across the Monero Blockchain, since its first genesis block, becomes a possible signatory to the transaction. The number of possible signatories depends on the mixing depth that you set. For example, a depth of four implies that any free Monero keys which have been used are also potential signatories to your transaction, and as your transaction is split into units which all possibly derived from this group signing pool, ring signatures ensure that transactions can't be decisively tracked back to specific computer IP addresses. To sum it up, it's pretty damn hard to identify Monero users. The combination of the elements mentioned makes Monero a virtual maze of mirrors for any adversarial tracker, no definite linkage can be determined only the fuzzy possibility of linkage. To put it bluntly the best Blockchain forensic techniques which could feasibly applied to Monero transactions would likely prove inadmissible or at least unconvincing if presented as evidence in a court of law. Even Monero miners are unable to censor transactions. It's far more likely that some element beyond the scope of Monero's code would result in deanonymizing its average user. However, everything has a price. The unanimity methods mentioned are expensive in terms of data requirements. So, there's always a trade off. Additionally Monero's block size grows with increasing demand although a penalty fee is in place to prevent bloat. For this reason Monero users uses more system resources than Bitcoin and most of the cryptocurrencies. Now, this may become a serious obstacle to its future success, but time will tell. So, that's everything for this episode and this lecture on Manero. I hope you enjoyed it. See you in the next.

About the Author
Students
458
Courses
8
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Ravinder is an expert instructor in the field of cryptocurrencies and blockchain, having helped thousands of people learn about the subject. He's also the founder of B21 Block, an online cryptocurrency and blockchain school.