Here is an attention-grabbing proposal from Ruben Somsen that may assist improve the privateness of these receiving bitcoin: Silent Payments. Somsen’s proposal builds on ideas like BIP47, which permits people to create reusable fee codes that may be tweaked by others to create distinctive public addresses that solely the sender and receiver are conscious of. This enables the receiver to just accept bitcoin in a extra non-public trend when in comparison with exposing a xpub or just reusing a single tackle to obtain funds.
BIP47 introduces the tradeoff of elevated information utilization because the reusable addresses it permits are produced by together with OP_RETURN messages, which require extra information than your common bitcoin transaction. With silent funds, the tradeoff made by BIP47 within the type of further information related to the creation of a fee code utilizing OP_RETURN is eradicated and changed with a rise within the scanning necessities of pockets software program. The best way I perceive it, senders take a silent fee public tackle offered by a receiver, use the non-public key of the enter (UTXO) they are going to be utilizing to ship bitcoin to the receiver to create a brand new public tackle owned by the receiver and ship the bitcoin to that tackle. The receiver then scans the blockchain for inputs and makes use of information related to their silent funds tackle to establish the place funds have been obtained.
That is an attention-grabbing tradeoff as a result of it might scale back the long run information burden on these working full nodes whether it is adopted in favor of options like these enabled by BIP47, however requires buy-in from these constructing pockets software program to make sure that their merchandise are appropriate with the silent funds design scheme. A heavy elevate, little doubt, however one which may be worthwhile to attempt to get applied throughout these pockets softwares. This would supply elevated utility for these trying to obtain bitcoin funds with higher privateness assurances and fewer interactivity with the chain. Assume dissidents dwelling below oppressive regimes who must obtain funds as privately and simply as doable.
Earlier as we speak, somebody initiated the primary silent funds transaction on Signet, a bitcoin testnet. You may dig into that here. We will probably be conserving you freaks abreast of the developments of silent funds as they unfold.