DASH - Reading Assignment

Privacy Coins - Ultimate Course
#201
  1. The information of the sender and receiver by a mixing of tx.
  2. By the need of authorization of three masternodes witch each has to have 1000 DASH locked earning 45% of block reward for the tx that is divided in smaller amounts for homogenization.
  3. By cracking a master node, owning it, or vulnerating it any way to conect wallents of real sender and reciever.
  4. If a masternode is runned by a malicious actor or leaking the data of a PrivateSend
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#202
  1. What information does PrivateSend conceal, and by what method?

PrivateSend conceals the ownership of the coins and it does it using CoinJoin.

  1. How do masternodes improve on the initial CoinJoin proposal?

The masternodes automatically constructs the transactions needed.

  1. Alice send some DASH to Bob using PrivateSend. Describe how an attacker could link their addresses.

The attacker could hack the masternode and take control of it.

  1. In what way could PrivateSend be more risky than a normal Bitcoin Transaction?

It is not a Peer to Peer (P2P) transaction. The masternode is a “middleman” and therefore there is a risk if someone has hacked the masternode.

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#203

1.) By mixing Trx the sender and receiver are concealed
2.) Makes instant transactions possible
3.) Masternodes have access to valuable Information. If a Masternode is hacked, through this Information sender & receiver can be linked
4.) Masternodes could be run by anyone with 1000 Dash. You have to trust the Masternode. Dash is used by people seeking privacy and by that Dash and related Trx become a target/Point of interest.

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#204
  1. What information does PrivateSend conceal, and by what method?
    PrivateSend divides transaction entries into standard denominations. These denominations are 0,01 Dash, 0,1 DASH, 1 DASH and 10 DASH. To start the process, the wallet sends requests to masternodes for them to start mixing. The user choose a denomination within the parameters that the network allows. It can join several denominations to obtain totals he wish. The user’s request is made in such a way that the masternode receives the mix request but does not know who is sending it. This is the first step to ensure user anonymity. The mix request is then put into a “Mix queue”, where there are requests from other individuals. Once the queue is full, the mixing process begins for all users. To perform this process, the masternode combines the entries and instructs the users’ wallets to make the corresponding payments. This payment is made by the wallet to an address called direction of change. This change address is part of the addresses that the user’s wallet can create. Finally, to completely hide your funds, this process is repeated several times. With each repetition it becomes more difficult to determine where the funds originated and lead them to their identity.
  2. How do masternodes improve on the initial CoinJoin proposal?
    It’s not required that someone constructs the transaction. It’s done automatically by the masternodes.
  3. Alice send some DASH to Bob using PrivateSend. Describe how an attacker could link their addresses.
    The attcker must now the addresses of Bob and Alice and must run the masternode.
  4. In what way could PrivateSend be more risky than a normal Bitcoin Transaction?
    You have to trust the masternode operators.
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#205

  1. PrivateSend obscures the source of funding in a PrivateSend transaction, by using pre-mixed funds.

  2. Masternodes help coordinate coinjoin transactions.

  3. An attacker could hack or run a master node and gain access to their transaction information.

  4. PrivateSend could create complacency about privacy issues. In Dash, just as in Bitcoin, transaction information is only pseudonymous. Privacy is enhanced by running multiple levels of coinjoin transactions, but this only serves to increase the anonymity set. Close examination can reveal probabilities of the link between identities and addresses. Behavior over time can increase or decrease certainty of certain probabilistic linkages.

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#206
  1. The identity of the Dash user is concealed, and by the process of CoinJoin. There are at least two other people in a single transaction.

2, The masternode instructs all users’ wallets for the single transaction to pay the transformed inputs to themselves, so the value of Dash never leaves your wallet.

  1. If the attacker also link the addresses of the other user wallets for this transaction.

  2. The almost instant validation of transaction inputs and locking for network broadcast are being done on second-layer network of masternodes.

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#207
  1. PrivateSend is Dash’s version of CoinJoin method - allows users to anonymously mix their tokens and receive Dash which practically has no transaction history which can tie them with any user.
  2. Masternode is collateralized with 1000 Dash, they also receive 45% of dash block reward so masternodes are financially incentivized to keep the network running and protect it form harm. So masternodes are also part of DASH’es DAO (governance).
  3. If the attacker runs the masternode he knows the sender’s and recipients addresses.
  4. You can decide between private and public sending. the private sending may already look suspicious and as mentioned above, master nodes that take huge part in PrivateSend fearture can be compromised
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#208
  1. How are Wasabi and Samourai wallets related?
    Samourai and Wasabi were the same application at one point in time developers split. Both originate from CoinJoin proposal.
  2. What is a ‘Sybil attack’?
    Where a small number of users falsifies new identities and pretends to be much larger in number.
  3. How does Samourai protect against Sybil attacks?
    Samourai’s implementation of ZeroLink (called Whirlpool) has a different pricing mechanism than Wasabi. Whirlpool makes it more expensive for malicious actors. Wasabi wallet does not relay on a central server to process TX.
  4. What ‘trade-off’ does Samourai make in order to achieve #3? Why is Wasabi critical of this?
    Wasabi is critical to the backend server used to process users’ extended public keys. This require the trust of users “that Samourai isn’t trying to sell their public key data to third parties.
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#209
  1. similar to a coinjoin
  2. masternodes run the coinjoin to make it faster and easier
  3. sybil attack on the node ownership by an attacker
  4. low anonymity-set or bad-actor owning master nodes.
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#210
  1. PrivateSend allows you to hide the details of an operation in addition to the information about who issues and who receives a payment. The method is to make a “mix”of the transactions, which makes tracking difficult.
  2. A masternode collects the coins from different users, mixes them together in the CoinJoin Transaction.
  3. Hacking the masternodes.
  4. You have to trust the MasterNode operator. It could be run a malicious actor.
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#211 
1 What information does PrivateSend conceal, and by what method?
It conceals the sender of the transaction by mixing the transaction with two other users, with a CoinJoin implementation.

2 How do masternodes improve on the initial CoinJoin proposal?
CoinJoin normally requires someone to create the CoinJoin transaction, but this can be done through masternodes.

3 Alice send some DASH to Bob using PrivateSend. Describe how an attacker could link their addresses.
The masternode receives the information from Alice to send money to Bob. The masternode could be a spy, or somebody could spy on the masternode to get this information.

4 In what way could PrivateSend be more risky than a normal Bitcoin Transaction?
The user reveals that he wants privacy, while not having privacy.
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#212
  1. What information does PrivateSend conceal, and by what method?
  • PrivateSend conceals the senders of a particular transaction by mixing transactions in multiple rounds which makes tracking difficult.
  1. How do masternodes improve on the initial CoinJoin proposal?
  • To perform a transaction via CoinJoin, someone needs to initiate CoinJoin transaction. Masternodes manage this for all interested participants.
  1. Alice send some DASH to Bob using PrivateSend. Describe how an attacker could link their addresses.
  • An attacker could take over a masternode and could try to trace all mixing rounds and to re-engineer the sequence of mixing other transactions with Alice’s transaction. Good luck!
  1. In what way could PrivateSend be more risky than a normal Bitcoin Transaction?
  • PrivateSend uses masternodes as service providers for CoinJoin. As a masternode can be captured by criminals or state organizations, they could track your transactions and can learn about links with other individuals/organizations.
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#213
  1. It conceals the ownership of coins by using a coinjoin method.
  2. Masternodes are not requiring someone to construct the transaction
  3. If the attacker is running a masternode
    4.You have to trust the person who runs the masternode.
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#214

  1. PrivateSend conceals the personal information and ownership of the coins using the CoinJoin method.

  2. The master nodes mix the coins and automatically processes the inputs with that of at least two other parties.

  3. If the master node were a “bad actor”, the transaction information and that of the sender and receiver could the addresses.

  4. If a master node was compromised or was a “bad actor”.

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#215
  1. What information does PrivateSend conceal, and by what method?

It’s a trustless method of shuffling (mixing) transactions so that an external observer is unable to determine the source of funding when a PrivateSend transaction is created.

  1. How do masternodes improve on the initial CoinJoin proposal?

By collecting and mixing the transactions automatically without requiring someone to construct the CoinJoin transaction.

  1. Alice send some DASH to Bob using PrivateSend. Describe how an attacker could link their addresses.

By compromising the masernode involved in the transaction

  1. In what way could PrivateSend be more risky than a normal Bitcoin Transaction?

In PrivateSend we have a central authority that collects all the transaction information. If this centralized authority gets compromised, privacy is lost and involved users might be labeled as “having something to hide”, so becoming a target of regulators.

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#216

  1. Privatesend utilizes Coinjoin to conceal transaction history

  2. Masternodes improve Coinjoin because it is a native function of the blockchain. it does not require someone to create the transaction manually.

  3. Master node operator might have the ability to trace transactions.

  4. Private send is more risky than a normal transaction because there are more moving parts and still has a degree of trust associated with it.

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#217
  1. They conceal identity, amounts, and destination of funds by using POW mining and using Masternodes (special servers) Coinjoin, Instasend, Dash Evolution, Ect. There are financial rewards for Mining and Maintaining the nodes
    2.It makes everything more trustless and decentralized and allows for improvement end voting power within the ecosystem
  2. By someone taking control of one of the Masternodes
    4 If whales invest into the Dash infrastructure and obtain a large number of masternodes. They will have access to data and collude on decision making and vote on protocol changes.
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#218

1. What information does PrivateSend conceal, and by what method?
Not only the information regarding who issues and who receives a payment but also the details of an operation.
The method used to achieve such is by mixing transactions so tracking becomes a difficult task. It is called coin-mixing.

2. How do masternodes improve on the initial CoinJoin proposal?
The total amount to be sent is divided into smaller parts of equal size. The sender’s wallet selects a masternode and makes a transaction request for the total amount submitting all subtotals. Since 3 masternodes are required to complete a PrivateSend transaction the selected masternode joins two other masternodes and the subtotals submitted are mixed with all the other subtotals of all the other PrivateSend transactions on the same round. The sender’s wallet checks if the total amount to receive by the recipient is correct after the recipient has been transmitted such. If the amount is correct the transaction is performed.
The more mixing rounds a transaction takes part in the more private that transaction will be.

3. Alice send some DASH to Bob using PrivateSend. Describe how an attacker could link their addresses.
The attacker would need the control of one or more of the masternodes involved in the mixing of the transaction and see the inputs and outputs of the transaction.
This means the attacker would need to see all the mixing of all the parts of the transaction on all mixing rounds and, therefore, control, at least, one of the masternodes involved in each of the mixing rounds of the transaction.

4. In what way could PrivateSend be more risky than a normal Bitcoin Transaction?
Using PrivateSend can be seen as if the sender had something to hide. Therefore, they can be targeted by attackers (governments and other organizations or individuals) to spy on them.

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#219

1.) PrivateSend conceals the user’s DASH and crypto finances. The method used here is CoinJoin, which shuffles all the DASH in a user’s wallet with others.
2.) Masternodes improve on the initial CoinJoin proposal by receiving transaction requests from the user’s wallet, and are informed that said user is interested in creating a certain denomination using CoinJoin without any identifiable information of the user.
3.) An attacker could link Alice and Bob’s addresses if automatic backups on their wallets aren’t enabled. Their wallets only contain 1,000 address changes if this mode is disabled, and once those addresses are used up, CoinJoin will be unable to shuffle or change their addresses further. The hacker could see congruent addresses being linked multiple times eventually and see that Alice and Bob have been transacting with each other.
4.) PrivateSend could be more risky than a normal Bitcoin transaction because CoinJoin is an intermediary entity, and it requires trust of the user. Bitcoin, however, is totally decentralized with no middle-men involved and is a trustless system (uses verifiable math).

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#220

  1. What information does PrivateSend conceal, and by what method? :
    Swaps coins amongst users removing the link between sender and receiver maintaining coin fungibility.

  2. How do masternodes improve on the initial CoinJoin proposal? :
    Masternodes update the ledger, mix, distribute and verify all TX’s …vs… Coinjoins single signature per TX verification method in block construction.

  3. Alice send some DASH to Bob using PrivateSend. Describe how an attacker could link their addresses. :
    Attacker can run a master node or bribe a master node for the transaction information that is concealed only by a master node.

  4. In what way could PrivateSend be more risky than a normal Bitcoin Transaction? : In the sense / case of a masternode being compromised all privacy can be negated.

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