Overview
While Bitcoin is often perceived as anonymous, it's actually pseudonymous—all transactions are publicly visible on the blockchain. Privacy coins implement various cryptographic techniques to hide transaction details.
Monero (XMR)
Monero is the most widely used privacy cryptocurrency. It implements privacy by default through:
Ring Signatures
Hide the sender by mixing transaction inputs with decoys from other users.
Stealth Addresses
One-time addresses hide the receiver's identity.
RingCT
Ring Confidential Transactions hide transaction amounts.
Zcash (ZEC)
Zcash uses zero-knowledge proofs (zk-SNARKs) to enable fully shielded transactions where sender, receiver, and amount are all hidden.
Note: Zcash privacy is optional. Only "shielded" transactions using z-addresses are private. Transparent t-addresses work like Bitcoin.
Comparison
| Feature | Monero | Zcash | Bitcoin |
|---|---|---|---|
| Privacy Default | Yes | Optional | No |
| Hidden Sender | Yes | Yes (shielded) | No |
| Hidden Receiver | Yes | Yes (shielded) | No |
| Hidden Amount | Yes | Yes (shielded) | No |
| Technology | Ring Sigs + RingCT | zk-SNARKs | Transparent ledger |
Other Privacy Coins
- Dash: Optional mixing (PrivateSend)
- Grin: MimbleWimble protocol
- Beam: MimbleWimble with Confidential Assets
- Firo (Zcoin): Lelantus protocol