To a lot of people, Bitcoin is the go-to digital currency when it comes to anonymity. However, these people fail to understand Bitcoin is anything but anonymous, although the digital currency does an OK job as far as privacy protection is concerned. While there are a fair few community members who wouldn’t mind having more privacy and even anonymity at their disposal when using Bitcoin, it could very well lead to confidential transactions. When everything’s said and done, these transactions will ruin the entire concept of Bitcoin, in a way.
Also read: Digital Currency Walking App Bitwalking In The Hot Seat Later Today
Do We Really Need More Privacy or Anonymity in Bitcoin?
It goes without saying that people are perfectly capable of deciding for themselves whether or not they want more anonymity in their financial ecosystem or not. To some people, it might prove to be advantageous to use Bitcoin as an anonymity tool, although it immediately begs the question of what they could have to hide.
On the other hand, the transparency associated with Bitcoin is something that scares away both consumers and business. All transactions are publicly visible for anyone to see, but there is no personal information displayed on the network, other than a wallet address. These addresses provide pseudonymity to users, as they can keep their personal information safe while still conducting business in public.
Depending on how one might want to look at things, anonymity is not something that will do the Bitcoin ecosystem any good, assuming it is forced upon users. If developers were to add an optional layer of added anonymity to the Bitcoin source code, the story would be entirely different. Giving users choices is never a bad thing.
Looking to the future, more anonymity wouldn’t do Bitcoin any favors regarding regulation and legislation either. Government officials have a hard time dealing with Bitcoin in its current form, let alone if it had options to make digital currency properly anonymous. With KYC and AML procedures as tight as they are, identification verification with a more anonymous version of Bitcoin would become all but impossible.
Finding The Right Balance
No one is saying these procedures are working at an optimal level, mind you, as there is lots of room for improvement. However, they do the job in a sort of adequate manner, as transactions can be linked to certain individuals. People who are using Bitcoin because they want to remain anonymous might want to reconsider that stance once they try to cash out a Bitcoin balance through either an exchange or Bitcoin ATM.
That being said, more privacy for companies wouldn’t necessarily be a bad thing. There is no need to let competitors look up every single transaction and its origin, just like there should be no need to keep everything locked away and inaccessible. A delicate balance between transparency and privacy needs to be established sooner rather than later.
Source: Reddit
If you liked this article follow us on Twitter @themerklenews and make sure to subscribe to our newsletter to receive the latest bitcoin and altcoin price analysis and the latest cryptocurrency news.
No Responses