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Blockchain Based Privacy Enhancing Technologies

4 min read

As Web3 continues to evolve and develop, there is an urgent need to focus on privacy on the blockchain in a similar, if not a more advanced manner, than what is available for Web2. Web3 users want to control their privacy on the blockchain and choose when they reveal personal information, such as addresses, transaction amounts, and even IP addresses.   

The OMNIA team has thus compiled the following resources that explain unfamiliar concepts such as confidential transactions, MimbleWimble, Ring signatures, Dandelion, bulletproofs, Mixers, zero-knowledge proofs, and secure multi-party computation.

Confidential Transactions

Confidential transactions (CT) on the blockchain is the idea of shielding transaction amounts that would otherwise be publicly available on the broader network. The sensitive information is only disclosed to the sender, receiver, and other parties selected to view it. 

The idea was first discussed by Blockstream CEO Adam Back in 2014 and has since gathered traction in the Web3 space. 


MimbleWimble is a blockchain protocol derived from a spell in the Harry Porter series of books with a similar name, which ties people’s tongues in a knot, thus preventing them from revealing sensitive information. 

The protocol uses Elliptic Curve Cryptography to verify transaction amounts without publicly revealing any information on the public network. It borrows a lot from Confidential transitions, whereby information is only disclosed to the sender and receiver of the transaction.   

Ring Signatures

Monero is one of the most popular privacy coins that utilizes ring signatures. This type of privacy-enhancing technology allows any member of a particular group, or ring of network participants, to validate a transaction by another entity in another group without revealing who approved it. 


Dandelion is a protocol implementation at the base layer of a blockchain that introduces a new pattern for nodes to communicate. It goes a step further by frustrating efforts to trace the origin of transaction messages and IP addresses of nodes.   

Zero-knowledge Proofs

In mathematics, Zero-knowledge proofs are ways of verifying the truth of a set of information without revealing the information itself. First introduced in 1985 by MIT scientists, Zero-Knowledge proofs have found real-life use cases in increasing privacy on the blockchain. ZCash is a popular privacy coin that utilizes Zero-knowledge proofs.


Bulletproofs are a type of short non-interactive zero-knowledge proofs that requires no trusted setup. They enable efficient, confidential transactions on blockchain networks such as Bitcoin.

Secure Multi-party Computations

Secure multi-party computations is a cryptographic protocol that distributes computation across multiple parties without one individual party knowing what the other party is calculating. Although yet to become popular amongst crypto and blockchain projects, it could be an alternative way to increase users’ privacy. 

Secure Multiparty Computations on Bitcoin – A research paper by Alumni of the Univeristy of Warsaw (Poland) Marcin Andrychowicz, Stefan Dziembowski, Daniel Malinowski and Łukasz Mazurek.

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