- 99% of transactions on Zcash are traceable
- Most users don’t activate privacy-enhancing features
- The authorities can now easily track transactions on Zcash
Zcash News Today – Chainalysis, a cryptocurrency analysis firm in the United States says it can track over 99% of all transactions involving the Zcash coin, and nearly all of Dash’s coins. Recall that both network’s fancy themselves as private offerings. They claim to be untraceable.
Now, Chainalysis has debunked such claims. This is possible because most users utilizing these tokens don’t use the optional privacy-enhancing features on the two blockchains. The amount of Dash transactions that make up actual transfers using Privatesend, (the privacy feature on Dash), is less than 0.7%.
Chainalysis Has Made it Easier for the Authorities to Track Transactions on Privacy Networks
By tracking the so-called privacy cryptocurrencies (that is digital assets with the primary purpose of hiding financial transactions) Chainalysis has now made it a lot easier for law enforcement to track transactions on such networks. According to the U.S.-based digital asset analysis firm:
“Dash and Zcash allow users to conduct transactions with greater privacy, but that doesn’t mean they provide total anonymity,”
Take an example, just 0.9% of the transactions on Zcash’s network make way for maximum privacy, despite having enhanced cryptography features. The firm added that:
“Even Zcash’s obfuscation is stronger because of the zk-SNARK encryption, we can still offer the transaction value and one address for more than 99% of the activity on ZEC.”
Chainalysis is more ruthless when it comes to Dash. The platform said:
“Calling Dash a privacy coin is a misnomer. From a technical point of view. The coins’ privacy functionality isn’t greater than that of Bitcoin. Independent wallet software offers more advanced methods of Coinjoin that have been used with major cryptos that are not regarded as privacy coins.”
Privacy Coins Have Been Debunked in the Past
Privacy coins have previously been debunked. Recall that in the past some researchers from Carnegie Mellon University found that over 99. 9% of all transactions done on Zcash and about 30% of transactions done on Monero (so-called privacy coins) transactions were traceable. Besides, the bulk of Zcash and Dash usage is mainly for non-privacy purposes. Based on studies conducted by the Rand Corporation, among the digital currency addresses that were referenced on the dark web, just a little less than 0.2% were for one of the two digital currencies or both assets.
Meanwhile, Dash and Zcash account for a whopping $1.5 billion daily trading volume at press time. Dash has dropped by 0.36% and is currently trading at $77.78 in the last 24 hours. Zcash on the other hand fell by 0.68% and is currently changing hands at $52.10 in the same time frame.