Bitcoin without privacy is a surveillance system

Builder: Yuval Kogman (no doubt)
Languages: Rust, C#, Go, Python
Contributions (S/ED): Rust-Payjoin, Wabisabi/Wasabi 2.0, General Privacy Research
Work (S/ED), URL: Helix (current), ZKSNACKS (formerly)
Yuval was interested in subjects related to Bitcoin before the world was truly born. He is a lifelong software developer and technology enthusiast, as well as a general-purpose automator who was initially interested in cryptotech around 2002.
His father attended a speech by the famous cryptographer Adi Shamir, who co-invented the RSA signature program on ecash. Later father-son conversations and Yuval now knows the concept of connectable ring signatures, double spending issues and ecash. His journey along the rabbit hole had begun, before the Bitcoin branch even removed a handful of dirt. He even ran Hashcash on a mail server in the early 2000s.
Like many bitcoins at the time (including myself), Yuval saw the original bitcoin article on Slashdot in 2010 and quickly regarded the whole idea as stupid and unfeasible. Later in 2013, he realized that Bitcoin was still around, hanging around about every ten minutes and creating a barrier, but Yuval still didn’t take action to get involved more.
Eventually, in 2015, he took advantage of an offer to sell him something, which was a problem. In fact, his own possession of some bitcoins is the last push he really went along with Rabbithole.
Filter noise
At the beginning of his field, Yuval was very concerned about studying different privacy coins.
Asked what makes privacy such an important area of focus for him, he said: “Realizing that my stupid impulse purchase or bad choice wallet software is recorded on the chain and everyone can see that if one day it is about to cancel Bitcoin, it may make me an easy target.”
Despite all the different approaches and potential advancements in privacy coins at the time, despite all the progress they have made in different areas, they are not fully convinced that they are a comprehensive solution.
“Even if I realize I only believe in Bitcoin, Imposter Syndrome also makes me try to understand everything. By then, new things to understand are made up much faster than I could keep up, but it took me a while to stop trying,” he said.
For some time, he just lurked on Reddit and Bitcoin Twitter, absorbing what was going on, but not really involved except research and learning. The first community he actively participates in is an open voice chat server called Dragon’s Den, which he heard on the Bitcoin podcast block Digest (Disclosure: The author operates both the chat server and co-hosts the podcast).
Wabisabi and Wasabi 2.0
Yuval is one of the designers of the Wabisabi protocol implemented in Wasabi Wallet 2.0. Wabisabi is a protocol designed to facilitate a common insertion of flexible denominations, rather than having to be exactly the same for each output. He was quick to point out that this was just a combination of one aspect of confidential transactions with anonymous certificates, and Jonas Nick had made that for the Ecash implementation.
One important thing to be clear is that Vabisabi is just a mechanism to replace blind signatures, allowing users to interact with the coordinator and complete the establishment of co-transactions, which are part of what these co-enter transactions are structured or on-chain. However, it is designed specifically to allow the construction of co-transactions and structure them at any amount without becoming a failure point for users trying to create such transactions for the coordination server.
Although Wasabi 2.0 does implement the Wabisabi protocol itself, the ZKSNACKS team has almost ignored all the research and work Yuval has done on arbitrary amounts of common transaction structures. He did the work to ensure that Wabisabi’s transactions are private enough and that there are no behaviors or transaction structures that may revoke user privacy after fact.
“The place where the error is a thousand cuts of deaths, which is the main reason Nopara73 and Molnard refuse to learn about how to avoid anything that’s already made in mustard [1.0.]transparent
He said: “From coin selection to the decision on what output value to use, to when to complete mutual assistance, and how to use TOR, corners are cut and implemented based on the atmosphere of basic mathematics, even the understanding of game theory does not apply to any strict assumptions necessary for the negative concept of service, nor any strict effect.”
As a specific example of general incompetence, he witnessed this at ZKSNACKS, saying: “Although Zksnacks claimed over the years that they had no logs, it is a relevant ‘fun’ fact, but unnecessarily using the default configuration NGINX for serving the website using the same hosting service as the logs, which means the logs are preserved.”
He ended up leaving Zksnacks due to his disapproval of the corners the company was cutting and his reluctance to participate in this.
Yuval’s current view of Wasabi wallets, especially given the current environment running Wasabi 2.0 coordinators, unless they believe that the server does not exploit implementation and protocol flaws to dename them.
The state of things
“Privacy is a human right, but in Bitcoin, it’s also a personal security issue for more or less anyone.”
Yuval’s view of the current state of Bitcoin privacy is not the most rose-like. He has many concerns about the general landscape now. In particular, the overly enthusiastic exchange of refusing to interact with users using privacy tools. He knows nothing about the use of privacy tools and can selectively disclose information to exchanges when needed.
“It’s different between sharing your information with the communication and extension regulators you trust and broadcasting throughout the world,” he said.
The indifference of the user is another thing related to him. Many users don’t care about their privacy and even consider it, and using privacy tools among Bitcoin users is actually a small thing. There is stigma in some social circles, even in terms of privacy. “…Indifference makes this stigmatization, effectively normalizing the lack of privacy[.] If you refuse to serve customers using privacy technology, the exchange will not lose many customers. ” he said.
He is not satisfied with the current privacy tools either.
“[R]Snake oil hawkers seeking “privacy wallet” have drugged the well. Their zero-sum brainworm infestation has made them spend a lot of time lying in the hatred of Twitter, rather than God forbidding a textbook or academic newspaper. This toxic discourse also alienates users and falls into indifference and stigma. ”
Ultimately, all of these problems stem from social issues, how people or businesses act, how people react to other people’s actions, etc. This is the way it must be solved.
“There is not enough users to have privacy technology demands and normalizing their use of Bitcoin is a hell of a surveillance tool.”
spiral
In September 2023, Yuval was hired full-time by Spiral to work in Bitcoin privacy research and development. Given that many of the problems currently co-implemented are due to their dependence on centralized coordination servers, Yuval decided to focus its work on decentralized CoinJoins.
Therefore, on the spiral, he is working to diversify and coordinate together and improve the privacy capabilities of analyzing and optimizing multi-party transaction structures.
“My long-term goal is to be transparent about my now more developed shared batch ideas. Privacy should be close to 0 marginal costs, otherwise high fees will prevent its use. Nor should it be a “product” and Grifters can make money quickly by tricking uninformed users. In the end, it should be powerful and powerful, mainly against split attacks.”
[An intersection attack is an attack taking advantage of mixed coins being spent in the same transaction(s) together improperly to deanonymize their history.]
Currently, he is contributing to the rust library maintained by Dan Gould to work on his ultimate goal to achieve the decentralized CoinJoin protocol.
“Payjoin is currently [specified] Construct an agreement as a 2-party collaborative transaction. While this achieves only the first of these two goals, promoting it to multiple parties provides an opportunity to properly execute the third goal in any wallet. ”
Covenant
Yuval believes that the covenant is a valuable improvement to the Bitcoin protocol, but believes that the current covenant proposal is more individual than it is actually.
“Current favorites CTV+CSFS seems to be a big step forward, but I think it’s the way we need to expand and improve long term, even if CTV is promoted to TXHASH.”
He is a fan of the trend concept suggested by Rusty Russel’s excellent script fix, as a general mechanism to limit more complex covenants or other opcodes to prevent them from making user block verification too expensive.
“I regret to say that I also find a lot of discussion disappointingly, a lot of words spent in the circles about why a person’s preferred opcode is the best hammer because how many problems look like a specific nail, if you’re tricky enough, you’re such an idiot, and besides that dishonest dishonest rather than sharing my preferences.”
Overall, he believes that the dialogue around the covenant is poorly managed, focusing too much on the advice of a single covenant rather than considering which use cases we want to enable, and which use cases we don’t want to enable, and work backwards from there to design the appropriate advice to serve the use cases we need.
Used or lost
Regarding what steps can people on average Bitcoin do to improve their privacy or support privacy in general, he said:
“Accepting there is no magical solution, we have come across Bitcoin’s transaction graph.
Ultimately, privacy requires everyone to take action. So what do people do? Lightning offers some improved levels of privacy, still has the chain market and Wasabi (from the disclaimer above). Do your best. Investigate tools to verify what you can do and make sure you consider appropriately who wants to be private and how much effort it takes to do so.
“Even if you think you don’t need privacy today, at least figure out what you can afford if you might need tomorrow, so you won’t be caught off guard. Also consider that people who do need it today can have it without those who can have it without it, so if you want that option tomorrow, you should exercise it today.