Is the Bitcoin Privacy War a Cause for Concern?

Is the Bitcoin Privacy War a Cause for Concern?

Key Insights

  • Samourai and Wasabi are the two most popular Bitcoin wallets.
  • The enthusiasts of both wallets have criticized several decisions that could lead to privacy breaches of users' wallets.
  • It is advisable to use third-party privacy tools and verify their authenticity before deployment 

Bitcoin is in the headlines again. This is not the first time Twitter opinions and trends are shaping the discourse in the crypto ecosystem.

There have been several instances where crypto enthusiasts and industry players took to their Twitter pages and other social media channels to air their views on certain features of a token or blockchain network. 

Something similar has occurred again, with debates about Bitcoin privacy. They have dubbed the term "Bitcoin privacy war," with several enthusiasts adding their views. 

Amidst this ongoing debate, references are being made to two popular wallets that ensure a high level of transaction protection and shield. They are Wasabi Wallet (run by zkSNACKs) and Samourai Wallet. 

In the course of this article, we shall identify their importance and need for special reference in the ongoing debate. 

How the Bitcoin Privacy War Started?

Trezor, a BTC hardware wallet, announced its partnership with Wasabi Wallet. It is intended that it would enable Trezor users to privatize their Bitcoin stash and improve confidentiality.

However, this partnership did not go down well with Samourai wallet advocates.

They brought up criticisms against zkSNACK, the developer running Wasabi Wallet — for its decision to blacklist transactions. 

The debate has spiralled from the privacy of the coin into mudslinging. It has now become a power tussle as to which of the two top wallets should be adopted by crypto users. 

Criticisms on the Privacy Prowess of These Wallets

Much of the debate has been muddling between Wasabi wallet advocates and Samourai wallet enthusiasts. However, they made some criticisms worthy of note. 

  • Wasabi Censorship

Samourai Wallet advocates' main criticism of Wasabi Wallet is the latter developer's decision to blacklist certain transactions.

This decision was taken last year by zkSNACKs to disallow some Bitcoin transactions on Coinjoin, citing legal and regulatory reasons. 

Interestingly, zkSNACKs' Wasabi Wallet did not disclose the details of the legal and regulatory reasons.

They however said the censorship decision is "undesirable" but would help as many users as possible shield their Bitcoin. 

Samourai Wallet enthusiasts, however, see the decision as a betrayal of Bitcoin's notion of censorship resistance. 

  • Samourai Privacy Concerns

Critics of the Samourai wallet, who are largely supporters of Wasabi, argue that the former's default settings do not provide adequate protection for user privacy.

They fault the running of Tor— Wasabi Wallet's default privacy-preserving tool. 

These critics opine that users need to flip a switch to use Tor and hide their IP address. They mentioned the vulnerability that could occur when users forget to flip the settings when they set up their wallets. 

Similarly, another criticism is the need for users of Samourai Wallet to run their Bitcoin node to preserve the privacy of their assets.

They said many users do not run their Bitcoin nodes, and when they share their "xpub," it exposes their wallet information. 

Ultimately, the unanimous decision is to deploy privacy tools, irrespective of the wallet you use, and make informed/ independent decisions about privacy in crypto. 

Disclaimer: Voice of Crypto aims to deliver accurate and up-to-date information but will not be responsible for any missing facts or inaccurate information. Cryptocurrencies are highly volatile financial assets, so research and make your own financial decisions.

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