Why Monero is Better than Dash, Zcash, Zcoin (Even with Lelantus), Grin and Bitcoin Mixers Like Wasabi (Updated May 2020)

Published : 2/1/2020

Last updated : 5/7/2020

Not all privacy-centric coins can deliver 100% privacy, untraceability, security and fungibility in a 100% decentralized coin with a trustless setup. Here's what these attributes are and why they're important:

Private Your finances are not visible to the public. A person looking at the coin's blockchain won't be able to see how much money you have. Untraceable The coins can't be traced through blockchain analysis or blockchain monitoring. Secure All transactions are encrypted and the wallet which holds your funds is encrypted. Fungible All coins are equal and have the same value. Decentralized All nodes (a node is a running instance of the coin's blockchain) of the network are equal. There is no superclass of nodes which have more influence or control over transactions or the system than other nodes.

Coin analysis

Here is an analysis of well-known cryptocurrencies which claim anonymity and/or untraceability as their key differentiator. Bitcoin itself is not within the scope of this analysis since it's never claimed to be anonymous.

This site was made by Monero users. There was a time when we weren't Monero users but were concerned about financial privacy. We researched the coins which claimed to be private and this page is the result of our research. It's why we chose Monero over the rest. So, if we appear to be biased, we are, but we believe that bias is based on facts which you can read below and verify for yourself.

Overview

Select a logo to jump to that coin's analysis.

Private Untraceable Secure Fungible Decentralized Monero Yes Yes Yes Yes Yes DASH No No Yes No No Zcash No Not completely Yes No No Zcoin Yes Yes Yes Yes No Grin Sometimes No Yes Unsure Yes Bitcoin mixers No No Yes No Sometimes

Monero

Private private by default. The sender, receiver and amount of the transaction are all private. Some coins have a "rich list" which allows anyone to see which account has the most coins. Since Monero is private, a Monero uses a cryptographically sound system that allows you to send and receive funds without your transactions being publicly visible on the blockchain (the distributed ledger of transactions). This ensures that your purchases, receipts, and other transfers remain. The sender, receiver and amount of the transaction are all private. Some coins have a "rich list" which allows anyone to see which account has the most coins. Since Monero is private, a Monero rich list can't exist. Untraceable By taking advantage of ring signatures (a special property of certain types of cryptography), Monero enables untraceable transactions. This means it's ambiguous which funds have been spent, and thus extremely unlikely that a transaction could be linked to particular user. Secure Using a distributed peer-to-peer consensus network, every transaction is cryptographically secured. Individual accounts have a 25-word mnemonic seed displayed when created, which can be written down to back up the account. A password is mandatory when creating a wallet, and account files are encrypted with a passphrase to ensure they are worthless if stolen. Fungible All coins are equal and have the same value. A user, vendor, or any other entity can't block or blacklist certain Monero coins since the transaction history of Monero coins is ambiguous. Decentralized All Monero nodes are equal. There is no superclass of nodes which have more influence or control over transactions than other nodes. No person or entity can trace transactions by owning multiple nodes. Additionally, there is no trusted setup. This means that the need to trust a person or entity is not a factor. The only things that need to be trusted are the source code (which can be verified by anyone) and math.

Monero has been 100% open source from its inception, meaning anyone can view the software's source code to verify that no backdoors exist and that the software is secure.

Monero also has peer-reviewed research papers which mathematically and systematically verify all of its properties listed above.

DASH

Private DASH has a rich list, so this is not a private coin. The financial details of coin addresses are visible to anyone examining the blockchain. DASH isn't cryptographically private at all. Actually I had a slide in the deck that was like 'DASH, LOL,' and like nothing else... it's snakeoil and I'm just sort of beside myself about it, personally. Gregory Maxwell, Bitcoin Core developer and cryptographer, in a presentation to Coinbase . Peter Todd, another Bitcoin Core developer and cryptographer, has made a similar statement. Untraceable Transactions are routed through a series of Masternodes to make them untraceable. This practice might work if all masternode operators had only pure motives. However, if a government, group of hackers, other entity, or even an individual bought many masternodes (there would be no way to know if this occured) and if the transaction passed through a route where all of the masternodes were owned by that entity, then the transaction could be traced by that entity. Given the relatively low cost of masternodes and the enormous budget of governments and some organizations, the possibility that coins can be traced is real. Secure Transactions are cryptographically secure. Fungible Since transactions are not private, the potential exists for an entity to block or blacklist certain coins, making them less valuable than the others. See the note on the lack of Bitcoin fungibility below since the same principle applies to DASH. Decentralized Not all DASH nodes are equal. There is a superclass of nodes, called Masternodes whose owners have more influence over the system than regular node operators. This makes DASH semi-centralized instead of the ideal 100% decentralized system.

Zcash

Zcoin

Note: Zcoin is shifting from its current Sigma scheme to a new protocol that relies on its new work, Lelantus. Lelantus is going to be implemented in stages, and this article is going to assume all stages are complete and implemented for proper comparisons alongside projected implementation times. The reason Zcoin was given this luxury of being judged on its future protocol, and not Zcash, is because Zcoin has a roadmap with general timings for activation, whereas Zcash's 'privacy by default' plans are and continue to be nebulous.

Private Zcoin (XZC) will not have a rich list, so it will be private. By-default, mandatory privacy is expected to go live in 2021. Once implemented, a rich list will not be possible to create (though currently they do have one). Untraceable With the final stage of Lelantus implemented in 2021, Zcoin should not be traceable, although theoretical attacks have not yet been explored since it has not yet been released or had any time out in the wild. At present Zcoin is traceable if one puts a Zcoin address in a blockchain explorer and you can see its balance and related transactions. Secure Transactions are cryptographically secure. Fungible After the final stage of Lelantus goes live in 2021, it is assumed that Zcoin will be fungible due to the mandatory privacy enforcement. In this regard, it will be a true competitor to Monero. However... Decentralized Zcoin has implemented Znodes, which act simiarly to Dash masternodes, and have greater power than other nodes on the network. Since all nodes are not created equal, and the differenciating factor between them is the amount of money an individual has (Znodes cost 1000 XZC), the network is semi-centralized.

Grin

Private Grin does not have a rich list, which would indicate some form of privacy. Indeed, passive attackers scanning the chain cannot see which address has how much money in it, partially because amounts are obfuscated via confidential transactions, partially because address data is not stored on chain, and partially because of Mimblewimble's cut-through technology, where intermediate transactions can be removed from the chain, leaving little metadata from past transactions. Untraceable Grin does not defend against an active attacker building a transaction graph. It is possible for both miners and a slightly modified node to watch every transaction, save it before the cut-through technology kicks in, and build a complete transaction graph from here, along with retaining all 'cut-through' data. They would not be able to discern any information prior to when they start, but everything after they begin will be valuable metadata with which they could potentially link transactions. Secure Transactions are cryptographically secure. Fungible Since all transactions are questionably private, and potentially traceable, there exists the possibility of building a transaction graph, from which can be gleaned valuable information that can be used against an individual regarding their spending habits. Outputs can then be linked to identities, and, even though amounts are not seen, the fact that an output can be linked to an identity means the output can be tainted, just off of the basis of who has held it. We think this means that Grin is not fungible, as some outputs may b e tainted while others will not be. Decentralized Grin has no premine, founder's reward, masternodes, or treasury. They did not have an ICO, and are run in a manner befitting of a decentralized community. Grin is decentralized.

Bitcoin Mixers

Private All Bitcoin transactions are visible on the blockchain and there is a Bitcoin rich list, so Bitcoin is not private. Bitcoin is pseudononymous, not anonymous. For Bitcoin mixers, you have to trust that they can keep their data safe and are not owned by or cooperating with a government, hackers, or other entities. In July of 2017, the founder of the largest Bitcoin mixing service, BITMIXER.IO, announced that they were closing and gave this as their reason: … Now I grasped that Bitcoin is transparent non-anonymous system by design. Blockchain is a great open book… BITMIXER.IO, in an announcement of closing on Bitcointalk.org (emphasis in the original). A few weeks later, after considering the various privacy-centric coins, he said this: After the deep investigation I confirm that MONERO is the best privacy currency. So I strongly recommend MONERO for all people who need extra privacy. BITMIXER.IO, in a followup post. Untraceable Since all Bitcoin transactions are visible on the blockchain, ALL Bitcoin transactions can be traced. A Bitcoin mixer can highly obfuscate transactions, making it much more difficult for someone to trace the Bitcoins, but not impossible. As technology progresses and companies which specialize in tracing Bitcoin transactions become more prevalent, once highly-obfuscated transactions will become relatively easily traceable: Law Enforcement Continues to Invest in Bitcoin Tracking Services

Time.com: Bitcoins Are Easier to Track Than You Think

Elliptic: A Company Specializing in Tracing Bitcoin for Law Enforcement A Google search will reveal dozens of articles like the ones above. And remember, any transaction that occurred at any time in the past is on the blockchain and has the potential to be traced, even if a mixing service was used. In fact, the use of a mixing service is likely to draw attention to those transactions. Secure Transactions are cryptographically secure. Fungible Not all Bitcoins are equal and have the same value. Some Bitcoins have been blacklisted and blocked by several entities, making those coins less valuable than the rest. If you receive Bitcoins that were used in the past for illegal purposes, then your Bitcoins could be blacklisted even though you had nothing to do with the illegal activity. Or, say a government, employer, or some other entity decides to blacklist your Bitcoins in the future, much like they do with asset freezing or confiscation. There would be nothing you could do. Since a mixer only makes it more difficult to trace your Bitcoins, this category has been marked as "not fungible." Andreas Antonopoulos, a former Bitcoin Core developer who is well-respected in the Bitcoin and other cryptocurrency communities, acknowledges the Bitcoin fungibility problem in a YouTube video.

Discussion of the Bitcoin fungibility problem on Bitcointalk.org Decentralized Bitcoin itself is decentralized, but most mixing services are centralized. This means you need to trust them. Some newer ones, like Wasabi wallet are not, however.