Quote from: child_harold on January 26, 2015, 08:17:50 PM

To clarify (I was incorrect before).

Shadow>SDC transactions DO NOT reduce anon inputs/outputs in the system!

Please see the slideshow below and refer to the IRC transcript below.
Thanks

http://www.slideshare.net/shadowcash/presentation3-43827434

Quote

8:13 PM <TrollsRoyce> well when you convert sdc>shadow>sdc the shadow stays in the system pool
8:13 PM how does that work?
8:13 PM <TrollsRoyce> makes more sense to convert to shadow to help build up the pool but put funds back in sdc to secure the network
8:13 PM oh? it does?
8:13 PM <TrollsRoyce> yeah theyre anonymous outputs
8:14 PM <TrollsRoyce> they can only be redeemed with a valid ring signature
8:14 PM <TrollsRoyce> so the pool keeps growing the more sdc>shadow
8:14 PM ⇐ allien quit (~allien@static-84-42-162-78.net.upcbroadband.cz) Quit: Leaving
8:15 PM SO the Shadow > SDC does not reduce anon I/O???
8:15 PM <TrollsRoyce> no it doesnt
8:15 PM wow
8:15 PM OK
8:15 PM i get it
8:15 PM <TrollsRoyce> it actually increases it because you can keep converting back and forth creating a larger pool
8:15 PM thats fucking huge
8:15 PM yeah it finally makes sesne
8:15 PM ⇐ Gritt-N-Auld quit (~gritt@unaffiliated/gritt) Read error: Connection reset by peer
8:15 PM sense*
8:16 PM <TrollsRoyce> http://www.slideshare.net/shadowcash/presentation3-43827434
8:16 PM <TrollsRoyce> the slides explain everything

Thanks for the clarification, that makes sense.

However I would like to note that it seems still important to have a large amount of coins stay in Shadow at any point in time as well. To illustrate this, imagine if there were actually zero coins in Shadow at present time. Yes there could still be anonymous inputs and outputs from people who transferred into and out of Shadow in the past. However someone trying to break the anonymity of the system could simply add up all of the SDC on the blockchain. They would realize by adding it all up that actually no Shadow exists in the network at that time and its all in SDC. Then if someone tries to wash some coins by sending 1000 SDC to Shadow, and then back to SDC, it may be pretty easy to identify and unmask the addresses.

However if there were say 100,000 or 1 million Shadow in Shadow at all times, this allows you to blend in with the rest of the Shadow to achieve more plausible deniability. The larger the pool of Shadow the greater the plausible deniability. However at a certain threshold it should be enough, and at that threshold adding more Shadow to the system will have smaller and smaller effect on plausible deniability.

Would anyone disagree or agree with this assessment?