Bitcoin may be one step closer to offering users improved confidentiality.
Proposed in a new paper authored by heavyweight cryptographers including Dan Boneh, Pieter Wuille and Greg Maxwell, “Bulletproofs” outlines a new technique that would reduce the size of so-called “confidential transaction” code – long floated as a possible way to shield the transaction amounts currently public on the blockchain, the cryptocurrency’s globally distributed ledger.
A rough sketch of the confidential transactions idea was first proposed informally on a popular bitcoin forum in 2013 by Adam Back, CEO of bitcoin startup Blockstream, and while the technology has been iterated on over the years, it still comes with a high cost. Transactions that use the technology take up about 16 times more space in the blockchain than normal bitcoin transactions.
Because of this, the idea has been dismissed as too bulky for the live bitcoin network, which is already facing much-discussed scaling problems.
But the new paper, co-authored also by Benedikt Bunz, Jonathan Bootle and Andrew Poelstra, contends Bulletproofs will slash the size of confidential transactions to under even that of a normal transaction.
In the announcement email, Maxwell said:
“This cuts the bloat factor down to about 3x for today’s traffic patterns.”
However, Maxwell went on to note that even though the confidential transactions idea is making progress, there are still issues to iron out. For one, the time it takes to verify a confidential transaction is still a “bottleneck” developers are continuing to chip away at.
And while the researchers can’t yet hint when the code might go live, the strength of the team hints at the growing awareness that some public blockchains are lacking in privacy.
For example, privacy emerged as a hot topic during ethereum’s annual developer conference Devcon3 this year, with the protocol looking to integrate zk-snarks, the tech behind anonymous cryptocurrency zcash. The example also serves to highlight the different approaches to the issue being taken across communities.