Post
Topic
Board Altcoin Discussion
Merits 5 from 2 users
Re: comparison on privacy between Ethereum and bitcoin
by
d5000
on 04/06/2025, 23:25:42 UTC
⭐ Merited by pooya87 (4) ,dumpsterhawk (1)
For example when you say "If.." as if you don't know if that is how it works and then making some wild guesses like "if that's how it works in bitcoin then it must be the same in ethereum".
I think what dumpsterhawk meant that your privacy depends on your transacting behavior if using SPV clients, be it Bitcoin or Ethereum. And that's also my understanding of the matter. It depends obviously on the tech used in the client software, but the challenges for privacy on ETH and BTC are the same.

On common SPV clients like Electrum/Sparrow the biggest risk regarding privacy is that you leak addresses/utxos belonging to one HD "wallet", because when the wallet is synced all addresses (and thus all your UTXOs) are shown to the full node (e.g. Electrum server) providing you the data. You have the option to create a wallet for every address you use though, and if you restart both Tor and the wallet between each address usage then your privacy should be okay. However, this is a bit error-prone (one wrong transaction, one time forgot to restart etc. and your privacy is gone if you're unlucky) so it's not an ideal solution.

There are however other solutions like BIP 157 with the Neutrino client which do not have the "address leaking" problem but there are few desktop clients supporting it (Gingerwallet and Wasabi afaik; my problem with just these two is that the standard servers are run by a centralized team and I don't know if there are reliable third party servers, I'm about to try Ginger out however just for this reason).

Of course it's possible that a similar solution like BIP 157 exists for Ethereum and is better supported by current wallet software. In this case, from a practical point of view, ETH light wallets would have a privacy advantage.

I'm not knowledgeable enough about ETH, so I'm watching this topic because it's interesting for me too how Ethereum deals with this challenge. I haven't found much searching the web on the topic.

A pruned full node may fit your needs too, of course.