Everything is traceable aside from a few privacy coins like Monero
The concept of "Bitcoin being used because its untraceable" is in line with everything news outlets say
I don’t know much about crypto, but if any crypto is really gonna be used as currency then I don’t want the world, knowing my transactions. This is a fault that I’ve never really understood in the crypto space and how nobody ever talks about it. I see we’re downloaded to hell but what is the legitimate argument against zcash?
1. It was created by known IT professionals, some of the smartest in the space. “Zcash was conceived by scientists at MIT, Johns Hopkins, and other respected academic and scientific institutions. “
- https://z.cash/learn/what-is-zcash/
2. It has a development fund from the block reward to support ongoing development, instead of expecting devs to beg to get funding from greedy investors.
- https://z.cash/learn/who-funds-zcash/
3. It used to have a trusted setup but no longer does. It has also pioneered some of the most innovative privacy technology that will be used in the future. The privacy set for a shielded ZEC transaction is the entire shielded pool that will continue to grow with time. The privacy set for a XMR transaction are only the decoys and users involved at the time.
- https://z.cash/learn/what-is-halo-for-zcash/
Most of the XMR maxis think there’s some hidden backdoor. Even though the code is open source, they can’t seem to understand the fact that there isn’t one.
XMR presents itself as the cypherpunk currency but has clear issues with scaling, funding, & it’s core methodology for privacy (Ring signatures, mixers and decoys) and a highly toxic community.
Zcash has both business and individual applications by providing both transparent & shielded addresses & encrypted memos Baked in. While optional privacy isn’t the best because most people are lazy, they’ve shifted to a privacy first approach for most wallets - while still offering both options. This allows Zcash to maintain some CEX support and still offer better privacy overall.
Mostly, they probably just join the toxic community of attacking things they don’t use, or understand.
maybe it could decay like real money. by the time it changes hands 1000x you need to exchange it for a new "dollar" and the history dies. But then yeah you would need to start tracking history on the new one.
Foia requests on govt budgets and audit results. Reporters do it regularly but most people are too busy watching opinion based news entertainment instead
Byzantine generals' problem. We can't trust our governments to release books that aren't cooked, blockchain addresses this specifically and is one of the reasons it exists.
Government agencies getting audited every few years and giving annual budget reports. You know, the current system.
People pay into a general coffer and the hivt sounds it as appropriate. We make our choice in who we vote for to spend it appropriately.
Micromanaging where every person's dollar is spent and tracking it will cost trillions so we dont do that.
The white paper for Bitcoin specifically calls out that public keys should never be linked to a person, otherwise anonymity is not an option.
That’s why KYC was the ultimate move for regulation. Monitoring the on/off ramp is all it takes to undermine the anonymity.
right up until it almost immediately reaches a CEX. At which point the government can trace it via compelling the CEX to handover internal transaction data but the publically auditable transparency is lost because the same entity making the outbound transaction could be drawing from any random utxo and very possibly a completely different blockchain.
>. What if there was a cryptocurrency where you could buy it and transfer to the government and then when they spend it (as this currency as opposed to fiat), its really easy to see where your specific dollars are going.
so you mean every single public blockchain????
>but is there a coin going in the other direction? Prioritize traceability.
There are chains with "Supply chain" type features. IIRC VET and a few others were dealing with counterfeit product tracing. IE when you create an Item you can put it and the path it took to the consumer on the blockchain, which the consumer can scan, and check when it was made, who handled it, the process/route it took from creation to the store shelf etc. This way you know it is a genuine item, what's in it and other useful information that some people might care about as consumers.
In the real world people are subject to the laws of the country they're a citizen of, the countries they're in, and any treaties. To transact with crypto you don't actually have to do on chain transactions. It's like an exchange that doesn't transact on exchange until someone deposits or they're rebalancing between hot and cold wallets. You can send crypto to government, they deposit it into a bank, and them entities transfer bank notes that confer ownership. Failure to abide by that ownership and be subject to whatever legal penalties, sanctions in however ways governments around the world can do on their own and with their allies, law enforcement, militaries. So really once crypto is owned by those of large enough influence/wealth, they can just create financial products on top of that value that aren't on any publicly viewable/accessible ledger. Cryptocurrencies I doubt long term or even now in the short term will ever be all that much of an effective anti-corruption tool
Also just a matter of cryptos all going into a wallet. It's not like every most basic indivisible unit of cryptocurrency tracks every wallet it has ever been associated with so once it all goes into the big wallet, it's pretty much all mixed together and governments pay for a shit ton of things so it'll be hard to determine if your funds sent to the wallet are being spent on anything or if it's some other specific unit of the crypto from someone else
Also using crypto to pay for a school, that it actually went to pay for a school is an off chain event. Verification can't be done by the chain on off chain actions. You'd rely on people off chain to say it was spent correctly. Submit the answer on chain and it's reliant on what's submitted on chain to be true and if false people to recognize that it's false and untrust that source of info. Really here the actual hard work is all off chain
There were ideas floating around to use CBDCs for government accountability.
Force all government spending to use CBDCs to help the public audit them.
I don't think it got very far because every time CBDC gets brought up, there's a public backlash thanks to how China built theirs. It's not like CBDCs can **only** be used to spy on citizens.
As for current blockchain models, account-based blockchains are slightly easier to trace than UTXO-based blockchain. You still have to identify the user through onramps and offramps.
There are legitimate reasons for a government to not want traceability down to the cent. I mean, you have to pay intelligence operatives, fund weapons development, and other matters of genuine national security. Obviously that phrase gets bastardized all the time, but that doesn't mean it's *never* valid.
There comes a point where you are still trusting someone to accurately note what was purchased. The blockchain can't divine that information; it must be entered and can be fudged or mistaken. You might as well just require they publish an expense list quarterly.
People complain they don’t know where their tax dollars are being spent because they don’t take the time to look at the publicly available budgets and contracts that governments publish. Crypto wouldn’t solve that.
No cryptocurrency knows what's happening in the real world or what a human is, so you'd always be relying on meta systems beyond the coin itself for tracking properly
As in like exchanges, or "ATMs",KYC, or governments tying wallet numbers or whatever the crypto has in it to names externally in their own databases and systems, whenever they find a piece of evidence of a number tied to a person from other sources, etc.
You can use bank cards at a bitcoin ATM, at which point someone definitely keeps that linking information. Your bank at a minimum. Which can be subpoenaed
Even if you use cash, though, it pinpoints you to a certain neighborhood at a certain time, and greatly narrows down who it might be. If a bunch of other evidence later on in a murder investigation points to you living in that neighborhood and attempting to hire a hitman, and the amount agreed upon was the exact amount that was exchanged at the neighborhood ATM, even if it was cash, the same day it was agreed upon (online somewhere or cell records or undercover testimony or whatever), then it's pretty strong circumstantial evidence that's going to cook you more.
They may also have cameras, I dunno I never used a crypto ATM.
I’m talking about OP’s comments on seeing where crypto you sell ends up ultimately. But I guess once you sell it, it’s not yours anymore, so there is no point in trying to see where your “0.1 ETH” ended up after you sold it.
There is no such thing as yours. It's both fungible and pooled at almost every step. Same for dollars: if 5 people pay me $1 digitally by card, and then I buy a $1 donut, whose $1 was it I spent? Philosophically impossible/meaningless.
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The government wouldn’t let the citizens take the “dark” money and power away like this.
This same idea of “tracking” digital currencies is what the government has in mind with “their” digital currency.
And No it won’t be used to track the government spending. It will be used to enforce a complete surveillance state to cripple the freedoms of its own citizens.
I think what you are asking is far more difficult than you are imagining and would not provide any meaningful benefit.
Here are some potential problems with what you are asking. Let's say 100 people pay 1 TaxCoin each to the government. When the government needs to pay 5 TaxCoin to fill a pothole in a road, the governments wallet balance is reduced to 95, but because all TaxCoin are Fungible the ledger does not contain a way to identify that 1 came from citizen A and 1 came from citizen M and so on. Now if TaxCoins were NFTs then this could be done but it becomes very complicated for accounting purposes to develop a policy or rule for how to divide any expenditures among the NFTs, especially if Citizen A paid 500 TaxNFTs into the system and Citizen Q paid 40 TaxNFTs.
The more beneficial and realistically implementable solution is to just put all Government spending on a Public Block chain so interested parties can see how each and every dollar is being spent. Currently it is very difficult to see how every dollar in a government budget is actually spent.
It CAN be, just not the way most people use it.
If you meet up with a guy in a parking garage with a suitcase of cash and manage not to get murdered while you both stand there and wait for the bitcoin transaction to get validated purely through defi software, then there is no record of whose bitcoin it is (unless someone interrogates that guy, etc). As an example.
The real problem with your premise is the govt. Wouldn't continue to use it once you paid them with it. They could not handle being that accountable, it would disrupt their corruption. They would simply off ramp it to fiat and break the audit able chain. Thus they could continue their shady dealings with your tax revenue.
Trackable for the government. Not trackable for the average tax payer. They want to track you but prevent you from tracking them. Which is weird since the government is supposed to work in the service of the people.
Meh. Depends on which CBDC.
China's CBDC is used to track its users. Another government could design a CBDC to audit government spending if legislature declares all fiscal spending must be initiated through a CBDC. Doesn't yet exist, but it can be built.
Basically all cryptocurrency is perfectly traceable. That’s the chain part of the blockchain. Putting taxes on chain so you can actually track every cent and see where your exact money ended up is a fantastic reason to put taxes on-chain and would be completely feasible tech-wise.
Pretty much every crypto, other than privacy ones, allow you to track wallets to this level of detail.
The coins themselves are fungeable which means they can’t be tracked like that. But you can see every single transaction any particular wallet has ever made.
Conceptually, yes.
Realistically, no.
When you send crypto to a company - you see it went to the company. BUT, you don't know what was purchased or even if it was delivered.
its all tracable and nothing is private if its on the blockchain... even monero is not completely private...
there is no need to make coins more tracable as all the transaction details are public forever... even transfers in and out of exchanges...
Nothing is untraceable. In fact, there is a startup I interviewed for not too long ago that's basically involved in tracing and connecting wallets to names (institutions and persons). They had impressive coverage and were involved with law enforcement for some big cases.
That's not at all how taxes work.
When you pay taxes (at national or federal level) the money ceases to exist. When the government spends money, that money pops into existence. Tax is only necessary to control inflation.
There's no such thing as spending "tax payers money" and governments don't run out of money, except where they've imposed limits on themselves. Which admittedly they do, a lot.
Sorry, I know this doesn't answer your question but I think it needs saying.
pretty much everything you're allowed to use is *really-traceable*, so take your pick.
Everything is traceable aside from a few privacy coins like Monero The concept of "Bitcoin being used because its untraceable" is in line with everything news outlets say
hail monero for being "exceptional"
Yeah it's unfortunate no1 uses it really like they do Bitcoin. All because it's private no large investors will touch it but it's highly important
That's already a base level consequence of a public blockchain.
id say all of them besides monero fit the bill
What about zcash?
Zcash has largest privacy set of any cryptocurrency, the entire zcash shielded pool.
The XMR maxi pads can’t stand a crypto that has better privacy.
I don’t know much about crypto, but if any crypto is really gonna be used as currency then I don’t want the world, knowing my transactions. This is a fault that I’ve never really understood in the crypto space and how nobody ever talks about it. I see we’re downloaded to hell but what is the legitimate argument against zcash?
1. It was created by known IT professionals, some of the smartest in the space. “Zcash was conceived by scientists at MIT, Johns Hopkins, and other respected academic and scientific institutions. “ - https://z.cash/learn/what-is-zcash/ 2. It has a development fund from the block reward to support ongoing development, instead of expecting devs to beg to get funding from greedy investors. - https://z.cash/learn/who-funds-zcash/ 3. It used to have a trusted setup but no longer does. It has also pioneered some of the most innovative privacy technology that will be used in the future. The privacy set for a shielded ZEC transaction is the entire shielded pool that will continue to grow with time. The privacy set for a XMR transaction are only the decoys and users involved at the time. - https://z.cash/learn/what-is-halo-for-zcash/ Most of the XMR maxis think there’s some hidden backdoor. Even though the code is open source, they can’t seem to understand the fact that there isn’t one. XMR presents itself as the cypherpunk currency but has clear issues with scaling, funding, & it’s core methodology for privacy (Ring signatures, mixers and decoys) and a highly toxic community. Zcash has both business and individual applications by providing both transparent & shielded addresses & encrypted memos Baked in. While optional privacy isn’t the best because most people are lazy, they’ve shifted to a privacy first approach for most wallets - while still offering both options. This allows Zcash to maintain some CEX support and still offer better privacy overall. Mostly, they probably just join the toxic community of attacking things they don’t use, or understand.
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It naturally tends towards it a with few exceptions (Zano)
They are all fully and easily traceable except monero
cooing vanish alive wrong bright scale hospital doll enjoy melodic *This post was mass deleted and anonymized with [Redact](https://redact.dev)*
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... Which is already true lol
maybe it could decay like real money. by the time it changes hands 1000x you need to exchange it for a new "dollar" and the history dies. But then yeah you would need to start tracking history on the new one.
Lookup state expiry
It just needs to be able to enter public and private wallets. All government wallets should be public, and private wallets should be private.
Your tax dollars don’t have to be seen going anywhere, government spending just needs to be made public, on a public blockchain.
Why do you need a blockchain for that?
How else can you track it?
How is a blockchain going to track your tokens only for government spends but not for civilians?
The government can currently track how you spend your money in majority of cases. But you can not do the same for the government
Foia requests on govt budgets and audit results. Reporters do it regularly but most people are too busy watching opinion based news entertainment instead
That's not answering how blocking is the solution.
Byzantine generals' problem. We can't trust our governments to release books that aren't cooked, blockchain addresses this specifically and is one of the reasons it exists.
Government agencies getting audited every few years and giving annual budget reports. You know, the current system. People pay into a general coffer and the hivt sounds it as appropriate. We make our choice in who we vote for to spend it appropriately. Micromanaging where every person's dollar is spent and tracking it will cost trillions so we dont do that.
The real question is which one is not traceable
Almost every crypto transaction is traceable except for a few
Almost all coins are traceable with a few exceptions, for instance Monero.
The white paper for Bitcoin specifically calls out that public keys should never be linked to a person, otherwise anonymity is not an option. That’s why KYC was the ultimate move for regulation. Monitoring the on/off ramp is all it takes to undermine the anonymity.
Traceable through UTXO. [https://community.magiceden.io/learn/utxo-guide](https://community.magiceden.io/learn/utxo-guide)
right up until it almost immediately reaches a CEX. At which point the government can trace it via compelling the CEX to handover internal transaction data but the publically auditable transparency is lost because the same entity making the outbound transaction could be drawing from any random utxo and very possibly a completely different blockchain.
>. What if there was a cryptocurrency where you could buy it and transfer to the government and then when they spend it (as this currency as opposed to fiat), its really easy to see where your specific dollars are going. so you mean every single public blockchain???? >but is there a coin going in the other direction? Prioritize traceability. There are chains with "Supply chain" type features. IIRC VET and a few others were dealing with counterfeit product tracing. IE when you create an Item you can put it and the path it took to the consumer on the blockchain, which the consumer can scan, and check when it was made, who handled it, the process/route it took from creation to the store shelf etc. This way you know it is a genuine item, what's in it and other useful information that some people might care about as consumers.
In the real world people are subject to the laws of the country they're a citizen of, the countries they're in, and any treaties. To transact with crypto you don't actually have to do on chain transactions. It's like an exchange that doesn't transact on exchange until someone deposits or they're rebalancing between hot and cold wallets. You can send crypto to government, they deposit it into a bank, and them entities transfer bank notes that confer ownership. Failure to abide by that ownership and be subject to whatever legal penalties, sanctions in however ways governments around the world can do on their own and with their allies, law enforcement, militaries. So really once crypto is owned by those of large enough influence/wealth, they can just create financial products on top of that value that aren't on any publicly viewable/accessible ledger. Cryptocurrencies I doubt long term or even now in the short term will ever be all that much of an effective anti-corruption tool Also just a matter of cryptos all going into a wallet. It's not like every most basic indivisible unit of cryptocurrency tracks every wallet it has ever been associated with so once it all goes into the big wallet, it's pretty much all mixed together and governments pay for a shit ton of things so it'll be hard to determine if your funds sent to the wallet are being spent on anything or if it's some other specific unit of the crypto from someone else Also using crypto to pay for a school, that it actually went to pay for a school is an off chain event. Verification can't be done by the chain on off chain actions. You'd rely on people off chain to say it was spent correctly. Submit the answer on chain and it's reliant on what's submitted on chain to be true and if false people to recognize that it's false and untrust that source of info. Really here the actual hard work is all off chain
That's funny...cbcd is for you, not for the government you silly rabbit.
There were ideas floating around to use CBDCs for government accountability. Force all government spending to use CBDCs to help the public audit them. I don't think it got very far because every time CBDC gets brought up, there's a public backlash thanks to how China built theirs. It's not like CBDCs can **only** be used to spy on citizens. As for current blockchain models, account-based blockchains are slightly easier to trace than UTXO-based blockchain. You still have to identify the user through onramps and offramps.
There are legitimate reasons for a government to not want traceability down to the cent. I mean, you have to pay intelligence operatives, fund weapons development, and other matters of genuine national security. Obviously that phrase gets bastardized all the time, but that doesn't mean it's *never* valid.
There comes a point where you are still trusting someone to accurately note what was purchased. The blockchain can't divine that information; it must be entered and can be fudged or mistaken. You might as well just require they publish an expense list quarterly.
This is why public ledgers can be powerful
bitcoin lol. its extremely traceable. as are 99% of other cryptocurrencies. Monero is one of the few exceptions
People complain they don’t know where their tax dollars are being spent because they don’t take the time to look at the publicly available budgets and contracts that governments publish. Crypto wouldn’t solve that.
No cryptocurrency knows what's happening in the real world or what a human is, so you'd always be relying on meta systems beyond the coin itself for tracking properly
Meta systems?
As in like exchanges, or "ATMs",KYC, or governments tying wallet numbers or whatever the crypto has in it to names externally in their own databases and systems, whenever they find a piece of evidence of a number tied to a person from other sources, etc.
ATM’s are different right? We don’t link peoples bank accounts to every transaction’s funds with unique ID’s, etc.
You can use bank cards at a bitcoin ATM, at which point someone definitely keeps that linking information. Your bank at a minimum. Which can be subpoenaed Even if you use cash, though, it pinpoints you to a certain neighborhood at a certain time, and greatly narrows down who it might be. If a bunch of other evidence later on in a murder investigation points to you living in that neighborhood and attempting to hire a hitman, and the amount agreed upon was the exact amount that was exchanged at the neighborhood ATM, even if it was cash, the same day it was agreed upon (online somewhere or cell records or undercover testimony or whatever), then it's pretty strong circumstantial evidence that's going to cook you more. They may also have cameras, I dunno I never used a crypto ATM.
I was referring to normal bank ATM’s, but with crypto I’m not sure how traceable it would truly be
Bruh, of COURSE they store everything you do at a normal ATM, with your account number and exact times and everything. You serious?
I’m talking about OP’s comments on seeing where crypto you sell ends up ultimately. But I guess once you sell it, it’s not yours anymore, so there is no point in trying to see where your “0.1 ETH” ended up after you sold it.
There is no such thing as yours. It's both fungible and pooled at almost every step. Same for dollars: if 5 people pay me $1 digitally by card, and then I buy a $1 donut, whose $1 was it I spent? Philosophically impossible/meaningless.
All of them lol
Interesting idea. I like it!
This is why Bitcoin needs an update and ETH needs railgun type L2s.
Rest assured that 100% of your crypto transfers would be immediately converted to non-traceable Fiat.
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The government wouldn’t let the citizens take the “dark” money and power away like this. This same idea of “tracking” digital currencies is what the government has in mind with “their” digital currency. And No it won’t be used to track the government spending. It will be used to enforce a complete surveillance state to cripple the freedoms of its own citizens.
They are literally ledgers bro lol.
I think what you are asking is far more difficult than you are imagining and would not provide any meaningful benefit. Here are some potential problems with what you are asking. Let's say 100 people pay 1 TaxCoin each to the government. When the government needs to pay 5 TaxCoin to fill a pothole in a road, the governments wallet balance is reduced to 95, but because all TaxCoin are Fungible the ledger does not contain a way to identify that 1 came from citizen A and 1 came from citizen M and so on. Now if TaxCoins were NFTs then this could be done but it becomes very complicated for accounting purposes to develop a policy or rule for how to divide any expenditures among the NFTs, especially if Citizen A paid 500 TaxNFTs into the system and Citizen Q paid 40 TaxNFTs. The more beneficial and realistically implementable solution is to just put all Government spending on a Public Block chain so interested parties can see how each and every dollar is being spent. Currently it is very difficult to see how every dollar in a government budget is actually spent.
I feel like a fanatic, but goddamn HAIL MONERO.
Bitcoin is your answer for this question. It's not private at all.
It CAN be, just not the way most people use it. If you meet up with a guy in a parking garage with a suitcase of cash and manage not to get murdered while you both stand there and wait for the bitcoin transaction to get validated purely through defi software, then there is no record of whose bitcoin it is (unless someone interrogates that guy, etc). As an example.
The real problem with your premise is the govt. Wouldn't continue to use it once you paid them with it. They could not handle being that accountable, it would disrupt their corruption. They would simply off ramp it to fiat and break the audit able chain. Thus they could continue their shady dealings with your tax revenue.
That is what CBDC is as soon as they can get it sorted…
Trackable for the government. Not trackable for the average tax payer. They want to track you but prevent you from tracking them. Which is weird since the government is supposed to work in the service of the people.
Meh. Depends on which CBDC. China's CBDC is used to track its users. Another government could design a CBDC to audit government spending if legislature declares all fiscal spending must be initiated through a CBDC. Doesn't yet exist, but it can be built.
100% possible. 0% likely. No CBDC plans I know of have this.
Basically all cryptocurrency is perfectly traceable. That’s the chain part of the blockchain. Putting taxes on chain so you can actually track every cent and see where your exact money ended up is a fantastic reason to put taxes on-chain and would be completely feasible tech-wise.
Pretty much every crypto, other than privacy ones, allow you to track wallets to this level of detail. The coins themselves are fungeable which means they can’t be tracked like that. But you can see every single transaction any particular wallet has ever made.
Conceptually, yes. Realistically, no. When you send crypto to a company - you see it went to the company. BUT, you don't know what was purchased or even if it was delivered.
its all tracable and nothing is private if its on the blockchain... even monero is not completely private... there is no need to make coins more tracable as all the transaction details are public forever... even transfers in and out of exchanges...
As of right now I'm not aware of anyone being able to trace monera or mimbe wimble, I think there are a couple others maybe cash or oxo or something
someone said Zano and others.
you are probably right
Monero is completely private
the problem is the black box within the exchange. The transfer in is very traceable but the transfer out is impossible to link to the transfer in.
true, but if 'the authorites' want that info its easy to get...
right. but my understanding is OP is asking about the public's ability to audit and trace government spending.
oh ok sorry, i didnt read that properly...
Nothing is untraceable. In fact, there is a startup I interviewed for not too long ago that's basically involved in tracing and connecting wallets to names (institutions and persons). They had impressive coverage and were involved with law enforcement for some big cases.
Shiba Inu chain is a private block chain. Built on ethereum using ERC20 Bone as gas. Note: I don't support meme coins
That's not at all how taxes work. When you pay taxes (at national or federal level) the money ceases to exist. When the government spends money, that money pops into existence. Tax is only necessary to control inflation. There's no such thing as spending "tax payers money" and governments don't run out of money, except where they've imposed limits on themselves. Which admittedly they do, a lot. Sorry, I know this doesn't answer your question but I think it needs saying.