What are privacy coins?

Privacy coins are digital currencies that have the necessary functionality to conceal the identities of those conducting transactions. Privacy coins are famous for their complete anonymity. While Bitcoin encrypts the wallet ID, the amount of Bitcoin being transacted and the wallet’s balance are made public. As a result, privacy coins are intended to safeguard genuine users who do not want their financial information to be publicly available.

Privacy coins accomplish the goals of the philosophy that underpins Bitcoin and other cryptocurrencies—the need for decentralization of the conventional monetary system and the shift of power and control away from the financial sector and toward the people.

Privacy coins are defined by their increased privacy and anonymity, and they are evaluated on three criteria.


The total amount of coins held, received, and transferred on the blockchain is not visible, traceable, or linkable in any way.


Each coin has the same face value and is convertible to the others. No coins get devalued or blacklisted as a result of their depreciating transaction history.


Each node has the same level of power and control. No node is more influential, significant, or valuable than another. No business is accountable for the coin’s development, upkeep, or portrayal. On the other hand, there is no centralized authority.

Privacy coins and features


By default, this privacy coin is completely secret, with many privacy features like stealth addresses and ring-encrypted transactions. (RingCT).

The stealth address enables a recipient to accept many payments using a single address without leaving a trail or connecting their address to another’s on the blockchain. RingCT masks the output and therefore hinders traceability. RingCT is a cryptographic technique that conceals the transaction’s value while allowing the network to verify it without disclosing it.

Monero is not in danger of being banned or debased, since all currencies have the same value and may be traded freely.


Zcash is a privacy currency that was created as a fork of Bitcoin. It has several privacy-enhancing features. The main privacy feature is zero-knowledge Succinct Non-Interactive Argument of Knowledge proofs (zk-SNARKs), which encrypts all network transactions and validates the correctness of the data being transferred without disclosing any transaction details. It is worth noting, however, that privacy features are optional since users may select between transparent (public) and private addresses.


Dash was created after the split of Bitcoin in 2014. It operates on an open-source peer-to-peer network and shares the majority of Bitcoin’s characteristics. However, Dash enhances the benefits of Bitcoin by allowing users to select between quick and private transactions. Additionally, Dash has a Proof-of-State protocol to assist miners who validate transactions through the first layer of the service.

Dash also offers the use of master nodes to verify transactions through their second tier of service, which is accessible to anyone with a minimum of 1,000 tokens in their wallet. The master nodes guarantee that transactions are private and quick.

Dash allows private transactions via the CoinJoin mechanism, which encrypts transactions as “joint payments” but conceals their specifics from other parties.

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