The ShadowCash community has been treated to something very special, as SDC is the very first digital currency currently publicly testing Zero Knowledge Anonymity on their testnet. Several transactions have been posted, to show off everything works as expected. Let’s take a look.
For those of you who are unaware of what Zero Knowledge Anonymity offers, allow me to give you a very basic explanation : it’s anonymity in a trustless form. A more detailed whitepaper explaining how the ShadowCash team implemented this feature will be released in the near future, so we will keep an eye out for that information.
To give you a bit of a real-life example on Zero Knowledge Anonymity, it allows a user to prove ownership of their coins to another user. However, this is done without revealing any identifying information about oneself. The only information disclosed is that user A knows some secret keys controlling “X amount of coins”. (Source)
There has been some confusion going on whether ShadowCash will implement either ZeroCash or ZeroCoin. The answer to that question is simple : neither. Zero Knowledge Anonymity in SDC is achieved through a unique approach combining dual-key stealth addresses, unique ring signatures (which will be replaced by snarks at a later stage) and non-interactive zero knowledge proofs. Not one single line of code is related to either ZeroCash or ZeroCoin, making this a truly unique project. (Source)
Private testing of SDC’s ZK implementation has been going on since early November, and the general community can participate in the public testing as of a few days ago. So far, everything seems to be going according to plan, but no official ETA on how long the testing phase will last was announced at this point.
I did mention there were some transactions posted to show off the Zero Knowledge implementation used in ShadowCash. Judging from these examples, you can clearly see the protocol in action, obfuscating the blockchain and making transactions untraceable as intended.
1. SDC to SDC (all parties are known)
2. SDC to Shadow or Shadow to SDC (i.e. one party is unknown (the shadow party))
3. Shadow to Shadow (neither parties are known – yay!)