The development team behind zcoin, a privacy-focused cryptocurrency built on the Zerocoin protocol, has announced a project to create a decentralized coin mixer for ether transactions.
Revealed in a post on the zcoin blog published 4th May, the idea is to create an ethereum-compatible version of the procedures in the Zerocoin protocol which allow users to convert non-anonymous cryptocurrency (bitcoin, ether etc) into an anonymous token.
The idea is that these tokens could be sent to another user, converted back into the base currency and spent without revealing the private token’s owner.
Running such a system on ethereum opens up the possibility of both leveraging the platform’s smart contract functionality and eliminating the need for a trusted third party to handle the mixing, as is currently the case with bitcoin mixers.
As the zcoin post explained:
“Unlike Coinjoin and its variants, it also does not require a central server to process such mixing, does not require you to trust any third parties and does not require other users to provide liquidity for a mixing transaction.”
While the highest levels of anonymity in the cryptocurrency space are currently associated with standalone currencies such as zcash, dash and monero, the zcoin mixer is representative of a small but growing trend in privacy projects focused on ethereum.
Another such example, ZoE (Zcash on ethereum), similarly showed that there are fruitful avenues to explore in bringing anonymity technology to the distributed computing platform.
Marble jars image via Shutterstock
Correction: An earlier version of this article referred to the Zerocash protocol. Zcoin is built on the Zerocoin protocol.