For disadvantage (2):
Apparently the only way around is to split-up the amount to be cleaned into smaller quantities and serialize the procedure. E.g. if I want to clean 100 BTC, I serialize it into 100 times 1 BTC, i.e. I will not send out the (n+1)th BTC to the mixer before I have received the nth BTC back. So my risk of fraud gets reduced to 1 BTC. The price I pay is the increased Tx fees, so I can half these fees by accepting twice the risk by selecting 2 BTC increments for the mixing procedure instead of 1 BTC.
gmaxwell's "
CoinSwap" introduces a framework that enables "secure" mixing in the sense that the mixer can't run with your coins. I believe CoinSwap is better for dedicated mixing than splitting funds into smaller quantities because it does not just spread the risk, it brings it down to just about zero. Additionally, the Tx fees are lower.
Thanks, I will have a look at CoinSwap...
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Now I had a look at CoinSwap. Nice! I was not aware of a concept like these "hash-locked" transactions.
I am wondering whether it is possible to combine the CoinSwap and CoinJoin concepts. Idea (Ex. N=3 again):
Traditional CoinJoin:
ConJoin Transaction: inputs = (1Ain, 1Bin, 1Cin), outputs = (1Aout, 1Bout, 1Cout).
New "CoinJoinSwap":
ConJoin Transaction 1: inputs = (1Ain, 1Bin, 1Cin), outputs = (1Xout, 1Yout, 1Zout).
ConJoin Transaction 2: inputs = (1Xin, 1Yin, 1Zin), outputs = (1Aout, 1Bout, 1Cout).
So here 6 participants are involved, namely Persons A, B, C, X, Y, Z.
Contrary to normal CoinJoin, taint is really removed instead of just "hidden".
A CoinSwap-like protocol would have to be defined to make sure that no funds can be embezzled (via hash-locked techniques?), and that no connections between the two CJ transactions can be made from the outside observer. And hopefully, it can be done in a way that there's not a "single-point-of privacy-leak" like in CoinSwap where "Carol can tell about Alice".
I am stopping here, because I did not understand CoinSwap to the last detail yet, but I have the feeling that such combined mechanism could be possible and trying to inspire...