Quote from: LaudaM on August 07, 2014, 11:30:38 PM

Quote from: fluffypony on August 07, 2014, 07:27:21 PM

Don't worry, you haven't spoiled anything. I live in South Africa, I know exactly what most people can afford more than most people here.

The "most people" you refer to will use a web wallet or an SPV-style wallet, regardless of the disk space they can afford. Full nodes for Bitcoin (and in future for Monero) are only run by crypto enthusiasts or companies who have a vested interest in doing so...and both groups of people can and do own sufficient storage space even at this very moment to soak up a 110gb blockchain.

To your last point, currently the only other way to provide cryptographically untraceable and unlinkable transactions is ZeroCash, which has been discussed at length and has drawbacks of its own (eg. the accumulator creation event trust issue). All the other methods that exist add layers of obfuscation, but do not provide cryptographically untraceable and unlinkable transactions.

Oh then you understand the issues in areas where people are poor. You must realize that not all of them are able to use web wallets (not enough knowledge related to technology overall. Would you be able to provide an objective opinion between Monero and Darksend+ (even though you're a developer there), if you have followed the development on this side too? (new update - Evan posted recently that the release is a few days away). Theoretically the transactions aren't untraceable and unlinkable, but they do add a lot more anonymity compared to the likes of Bitcoin.

I follow a lot of developments in cryptography, so I have of course been watching Darkcoin's progress. It definitely does add a lot more anonymity than Bitcoin provides, and that's certainly something that is to be applauded. Speaking purely from a cryptography perspective (and please do not take this as any sort of "FUD attack" or me being "anti-competitive" - I believe every cryptocurrency must carve out its own niche over time) there are two things that concern me:

1. Outputs can still be linked to addresses. If you send 20 DRK and it sends all these other outputs along with it to obfuscate, the 20 DRK still ends up in someone's address. That this can be observed on the blockchain means that analysis is easy, and we all know how often people leak addresses associated with their wallet (eg. posting it up for giveaways etc. etc.) This is an immutable problem in any Bitcoin-forked cryptocurrency that exists, as the solution (stealth addresses computed w/random data) has to be enforced for every transaction from the genesis block. If you enforce it halfway through you're stuck with old outputs that don't use stealth addresses, which makes it exceedingly complex to ensure the anonymityset is not at-risk.

2. Masternodes are an Achilles' heel. Let us say that there are 10 000 masternodes on the network. Their IP addresses and the port they operate on is, by necessity, known to the network. Let's assume that an attacker controls 5 masternodes of the 10 000. Let's also assume that each of the masternodes on the network is on a dedicated server (none of them use a VPS, because a VPS could be trivially owned by the host operating system) and each of these servers is on a 1gbps unmetered, dedicated port (clearly not the case right now, but I'm talking about a future time). How hard would it be for an attacker to knock the other 9995 masternodes off the network, leaving theirs as the only accessible masternodes (and thus not only earning them all the fees, but giving them perfect insight into transactions moving within their controlled group)? Well, NTP amplification attacks have let attackers launch 400Gbps attacks against a single machine from a sole 2mbps connection. SNMP has a theoretical 650x amplification factor. All an attacker needs to do is max out the unmetered port in an obvious attack, and the datacenter will have to react. Even straight up LOIC-style / botnet SYN floods to the port that the masternode has open will lead to the DC null-routing traffic to that box, typically for 6 hours whilst they wait for the attack to stop. Mitigating this is an extremely difficult and expensive operation for each masternode to individually undertake, and not all DCs will even be able to provide DDoS mitigation at this level. An unsophisticated attacker using extremely traditional tools can knock all of the masternodes off the network except those they control. This is a threat to anonymity.

Incidentally, the other problem with masternodes that nobody seems to have thought of is that the limited number of them will mean they're in direct competition with each other. It is in a masternode operator's financial interests to make life difficult for the rest of them - DDoS attacks, reporting the box to the datacenter, anything that can knock a single competitor off the masternode network means more fees for the remaining masternodes. This is different to PoW mining where, for instance, knocking the pools offline doesn't mean you'll get more transaction fees, as miners always have backup pools. I'm not sure how sustainable this is as a system if it unmistakably pitches operators against each other to fight for fees. Given the cost and capital required to own a masternode, it's appreciable that this will happen as a natural result of wanting to maximise masternode profits.