Quote from: posi on Today at 08:07:32 AM

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To be sincere, I'm lost here because chain analysis said something and you provided another proof which make the whole thing skeptical and complex for me to understand. However, chain analysis claim about Zcash was something that just happen Satoshi statement and the proof you provided are long ago statement, I'm not the one person to believe Zcash was not privacy coin as people thoughts and i guess we are in a stage where people decide by themselves either to use zcash as privacy coin or not.

Quite frankly this probably isn't the correct thread or the right place to explain how privacy / anonymity works in Zcash, but I will ...

First read ...

Zero-knowledge proof
- https://en.wikipedia.org/wiki/Zero-knowledge_proof

Non-interactive zero-knowledge proof
- https://en.wikipedia.org/wiki/Non-interactive_zero-knowledge_proof

- https://z.cash/technology/
- https://electriccoin.co/blog/anatomy-of-zcash/

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The Bitcoin ledger is public. It is an open book. All transactions are publicly viewable and are stored on the blockchain forever. Just look at any block explorer.

Zcash utilizes two address types t-addr and z-addr. t-addr are public just like in Bitcoin and are therefore publicly viewable.

z-addr are basically the equivalent of a black box, on-chain. It is impossible to view the transactions within the black box.

However, as a Zcash user ... let's say you buy one ZEC from an exchange service (who knows who you are through KYC etc.,)

You receive your ZEC to a t-addr (public). You then proceed to send one ZEC less the fees to your own z-addr (private) and in the next few blocks you send out the one (ZEC) less the fees to a t-addr (public) to buy something online.

It is relatively straight forward for a strong adversary doing chain analysis to match these likely inputs and outputs on chain and to perhaps identify you personally by contacting the exchange service, retrospectively.

The chain analysis article states that less than 1% of Zcash transaction (to date) are even utilizing z-addr > z-addr transactions i.e. within the black box.

Quite simply if the opposite was true and 99% of Zcash transaction were as z-addr > z-addr transactions it would become impossible to do chain analysis of the transactions.

An old internet adage states "You cannot be anonymous by yourself!".

Splitting inputs and outputs over time also makes chain analysis much harder ... i.e.

You receive your one ZEC to a t-addr (public). You then proceed to send one ZEC less the fees to your own z-addr (private) you then cold store your coins for x duration. Before spending anything outside of the black box you occasionally move your own coins from your own z-addr to another z-addr, perhaps to a different wallet. When you send out x number of (ZEC) less the fees to a t-addr (public) to buy something online, say months or even years later, it becomes much much harder to identify the origin of the coins.

It becomes impossible if your purchase is made to a z-addr, for example.

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Connecting your wallet via Tor and only making transactions through onion routing can also help to prevent other types of surveillance and analysis.

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I once wrote a piece on the Zcash community forum where I described DASH coin mixing vs Zcash shielded privacy as follows;

DASH - If you imagine a theatre stage with say eight piles of money on the floor (masternodes), the curtain rolls up and the cast of dancers enter from stage right and stage left with money in hand and proceed to move from pile to pile swapping money around then it might seem difficult for the audience to work out what is going one. However, imagine that the entire show is recorded by an audience member (on the blockchain) it is actual very easy in deed to replay exactly what happened (via a block explorer).

Zcash - Imagine the same stage, except this time the piles of money are behind a screen (shielded from the audiences view), if the majority of the dancers only swap money behind the screen, it becomes impossible for the audience to easily work out exactly what happened, even retrospectively.

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Financial Privacy is not a crime!

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Full disclosure, I currently host numerous Tor servers for the Zcash project, originally under a different guise, with funds from a first round Zcash (ZEC) Foundation grant. However, the price decline meant that I've mainly continued to do this under my own steam, with limitations. Something I hope to resolve with the Foundation in time. I'm otherwise not affiliated with any company. The project nodes can be found via this thread soon (Bitcoin BTC and Litecoin nodes as well) ...

- https://bitcointalk.org/index.php?topic=5177001.0

"The sculptor's marble sends regards" ...