• Contact Us
  • Affiliate Disclosure
  • Privacy Policy
  • Terms of Use
  • DMCA
Friday, February 3, 2023
WongaNews.com
  • Live Prices
  • Crypto News
  • Bitcoin
  • Altcoins
  • NFT News
  • Blockchain
  • Regulations
  • Trading
No Result
View All Result
  • Live Prices
  • Crypto News
  • Bitcoin
  • Altcoins
  • NFT News
  • Blockchain
  • Regulations
  • Trading
No Result
View All Result
WongaNews.com
No Result
View All Result

Mercury Wallet is pitching itself as Bitcoin’s answer to scalability, privacy

August 26, 2022
in Altcoins
Reading Time: 4 mins read
A A
ShareShareShareShareShare

Software engineer and privacy advocate Nicholas Gregory recently sat down with CryptoSlate to discuss Bitcoin privacy and developments at privacy-focused Mercury Wallet.

The talk was particularly pertinent considering recent events at Tornado Cash, which have fueled debate on Bitcoin’s superiority, at least from a censorship resistance standpoint.

With the Merge fast approaching, censorship risk remains an unresolved issue for Ethereum investors. Particularly as the switch to Proof-of-Stake potentially further exposes the protocol to sanction compliance, but this time via staking validators.

While Bitcoin is not 100% immune from censorship risk, for example, risk exposure via CoinJoin or the Lightning Network, the general sentiment is that Proof-of-Work mechanisms remain more robust when it comes to operating trustlessly.

Tornado Cash fallout reiterates importance of privacy

The U.S. Treasury added Tornado Cash to its Office of Foreign Assets Control (OFAC) list on August 8. Officials alleged that the crypto mixer was responsible for laundering over $7 billion in illicit tokens since 2019.

The fallout saw Tornado Cash’s USDC wallets blacklisted, the devs booted off Github, and the website was taken down. Adding insult to injury, addresses interacting with the blacklisted wallets were also flagged. Tron founder Justin Sun tweeted that Aave had blocked his account after a malicious prankster sent him 0.1 ETH from a Tornado Cash address.

This sledgehammer approach was intended to isolate Tornado Cash and penalize every entity that had used the protocol. However, as the non-profit organization Coin Center pointed out, the sanctions were a gross overreach of legal authority that potentially infringed on human rights and free speech. More so, as the protocol, being a neutral tool does not fit the definition of a sanctionable person.

“This action potentially violates constitutional rights to due process and free speech, and that OFAC has not adequately acted to mitigate the foreseeable impact its action would have on innocent Americans.”

Critics further argued that the OFAC actions also assumed every Tornado Cash user had criminal intent. Yet, Ethereum co-founder Vitalik Buterin said he used the protocol in an innocent way when donating to the Ukrainian fundraising campaign.

Statechain technology for privacy

With that, protecting personal privacy in the face of governmental overreach becomes all the more important, and Gregory thinks he may have the solution in Bitcoin Statechain technology on which Mercury Wallet is built.

Statechain is a Bitcoin layer 2 solution that focuses on improving transaction privacy. Similar to the Lightning Network, it works by moving transactions off the main chain onto its own chain to enable instant and low-fee private transactions.

“With statechains though, 2 private keys are needed to sign off the transaction, with one private key belonging to the user and the other private key belonging to the provider of the statechain (e.g. Mercury Wallet).”

In essence, Mercury Wallet never custodies or controls funds. Instead, value is transferred by giving the recipient the private key to the sender’s wallet. Under this system, the amount of Bitcoin sent in a transaction is fixed once a user creates the Statechain (the UTXO), meaning it cannot be split into multiple different amounts.

“For example, if you want to send 1 Bitcoin in one transaction to a friend (lucky them) and you create a statechain, you can’t then send 2 x 0.5 BTC transactions, it has to be 1 x 1 BTC as that is the UTXO which defines the amount to be sent.”

However, users must trust that the Statechain provider does not collude with the previous private key holder. Based on upholding the reputation of Statechains, the above scenario is deemed unlikely. Especially as each transaction has a different private key, and the bad actor would need all prior users to agree to defraud the system.

Nicholas Gregory discusses Mercury Wallet privacy developments

In developing Statechain technology and creating the Mercury Wallet, Gregory said it was done to make Bitcoin easier to use “with regards to scalability and privacy.”

Discussing Mercury Wallet with CryptoSlate, Gregory pointed out that the way it works shatters the tenet of “not your keys, not your coins,” which he finds highly entertaining.

“Mercury Wallet is an alternative scaling solution. What I like about it from an entertainment point of view is it breaks one of the foundations of Bitcoin – not your keys, not your coins. Well Mercury allows you to pass around private keys.”

Nonetheless, by his own admission, he conceded that “not many people know about it,” and the project also suffers from low liquidity.

To address these issues, the wallet developer said the team is looking to widen Mercury Wallet’s appeal by making it “blinded.” Meaning that the protocol will not know the details of transactions passing through the system, and it then becomes impossible to collect data.

“Blinded means we won’t know what we’re doing, which is great from a regulatory point of view in that we won’t be able to collect any data.”

To bootstrap liquidity, Gregory said plans are in place to sell Statechains paid for with Bitcoin to bring more liquidity into the network. Statechain buyers would be given “Statecoins,” which represent the Bitcoin held in the Statechain.

This will bring more liquidity to the protocol and enable Sidechain owners to transact the value of Bitcoin holdings without interacting with the main chain.

Gregory hopes these changes will be enough so that when Bitcoin layer 2s are mentioned, Statechains are in equal consideration with the Lightning Network.

Get an Edge on the Crypto Market 👇

Become a member of CryptoSlate Edge and access our exclusive Discord community, more exclusive content and analysis.

On-chain analysis

Price snapshots

More context

Join now for $19/month Explore all benefits


Credit: Source link

Related articles

Kraken closes Abu Dhabi office; Bithumb owner arrested

February 2, 2023

SBF wins Texas case alleging violations of securities laws via FTX offerings

February 2, 2023
ShareTweetSendPinShare
Previous Post

Five challenges of crypto regulation

Next Post

IRS Serves 'John Doe' Summons to sFOX Looking for Possible Tax Evaders – CoinDesk

Related Posts

Kraken closes Abu Dhabi office; Bithumb owner arrested

February 2, 2023

The biggest news in the cryptoverse for Feb. 2 saw Kraken announce the closure of its Abu Dhabi office. Meanwhile,...

SBF wins Texas case alleging violations of securities laws via FTX offerings

February 2, 2023

Former FTX CEO Sam Bankman-Fried gained an early victory in a case concerning Texas securities laws, according to Bloomberg News...

Asia, EU, US are bullish on Bitcoin, Ethereum

February 2, 2023

Glassnode data analyzed by CryptoSlate analysts shows that Asia, the U.S., and the EU have been bullish on Bitcoin (BTC)...

Charlie Munger calls on US to join China in banning crypto

February 2, 2023

Warren Buffett’s business partner Charlie Munger has proposed that the United States should follow in the steps of China to...

Render token up 17% after DAO approves burn & mint mechanism

February 2, 2023

Render Network announced that it has received governance approval to implement a burn and mint equilibrium (BME) mechanism for its...

Load More
Next Post

IRS Serves 'John Doe' Summons to sFOX Looking for Possible Tax Evaders - CoinDesk

Leave a Reply Cancel reply

Your email address will not be published. Required fields are marked *

Recommended

House Republicans move to regulate crypto with new subcommittee

January 13, 2023

Genesis owner DCG suspends dividend payouts

January 18, 2023

North Korea Is Targeting Crypto Hodlings – Are Your Funds Safe? 

February 1, 2023

About Us

Wonga News is an online news portal that aims to provide the latest crypto news, blockchain, regulations, and much more stuff like that around the world. We promise to share only high quality content from the world's best crypto sources. Feel free to get in touch with us!

What’s New Here!

  • Reliance Retail accept digital rupee at one store
  • Kraken closes Abu Dhabi office; Bithumb owner arrested
  • Defiance ETFs to Close NFTZ ETF After Just 13 Months

Newsletter

Loading
  • Contact Us
  • Affiliate Disclosure
  • Privacy Policy
  • Terms of Use
  • DMCA

© 2022 WongaNews.com - All Rights Reserved!

No Result
View All Result
  • Live Prices
  • Crypto News
  • Bitcoin
  • Altcoins
  • NFT News
  • Blockchain
  • Regulations
  • Trading

© 2022 - WongaNews.com - All Rights Reserved!

  • bitcoinBitcoin(BTC)$23,585.00-2.11%
  • ethereumEthereum(ETH)$1,649.24-2.04%
  • USDEXUSDEX(USDEX)$1.07-0.47%
  • tetherTether(USDT)$1.00-0.37%
  • binancecoinBNB(BNB)$325.541.27%
  • usd-coinUSD Coin(USDC)$1.00-0.39%
  • rippleXRP(XRP)$0.411822-0.81%
  • binance-usdBinance USD(BUSD)$1.000.10%
  • cardanoCardano(ADA)$0.401505-0.95%
  • dogecoinDogecoin(DOGE)$0.091706-3.80%
  • matic-networkPolygon(MATIC)$1.19-3.41%
  • okbOKB(OKB)$39.56-1.04%
  • solanaSolana(SOL)$24.40-4.19%
  • staked-etherLido Staked Ether(STETH)$1,644.35-2.10%
  • polkadotPolkadot(DOT)$6.580.31%
  • shiba-inuShiba Inu(SHIB)$0.0000121.04%
  • litecoinLitecoin(LTC)$99.50-2.09%
  • avalanche-2Avalanche(AVAX)$21.27-1.30%
  • tronTRON(TRX)$0.0644191.00%
  • uniswapUniswap(UNI)$7.243.92%
  • daiDai(DAI)$1.00-0.18%
  • cosmosCosmos Hub(ATOM)$14.50-2.71%
  • wrapped-bitcoinWrapped Bitcoin(WBTC)$23,603.00-2.08%
  • chainlinkChainlink(LINK)$7.14-2.17%
  • ToncoinToncoin(TON)$2.38-1.77%
  • ethereum-classicEthereum Classic(ETC)$23.453.50%
  • moneroMonero(XMR)$174.24-2.85%
  • leo-tokenLEO Token(LEO)$3.360.02%
  • AptosAptos(APT)$16.90-7.62%
  • bitcoin-cashBitcoin Cash(BCH)$138.710.64%
  • Aerarium FiAerarium Fi(AERA)$7.12-13.06%
  • stellarStellar(XLM)$0.092466-0.57%
  • apecoinApeCoin(APE)$5.88-3.99%
  • quant-networkQuant(QNT)$145.27-3.25%
  • nearNEAR Protocol(NEAR)$2.45-1.05%
  • filecoinFilecoin(FIL)$5.53-3.62%
  • crypto-com-chainCronos(CRO)$0.080998-1.27%
  • lido-daoLido DAO(LDO)$2.23-5.22%
  • algorandAlgorand(ALGO)$0.2582420.39%
  • hedera-hashgraphHedera(HBAR)$0.068144-2.18%
  • vechainVeChain(VET)$0.024469-2.14%
  • fantomFantom(FTM)$0.615.23%
  • internet-computerInternet Computer(ICP)$5.82-3.40%
  • decentralandDecentraland(MANA)$0.79-2.65%
  • axie-infinityAxie Infinity(AXS)$11.23-1.74%
  • aaveAave(AAVE)$88.89-2.79%
  • the-sandboxThe Sandbox(SAND)$0.76-1.93%
  • eosEOS(EOS)$1.08-1.53%
  • flowFlow(FLOW)$1.12-1.48%
  • elrond-erd-2MultiversX(EGLD)$44.880.34%