Privacy coin

A privacy coin is a cryptocurrency designed to hide transaction details, such as sender, recipient and amount, that are publicly visible on blockchains like Bitcoin and Ethereum. The best-known are Monero (XMR) and Zcash (ZEC).

Monero makes privacy the default, using ring signatures to mix the sender among decoys, stealth addresses to hide recipients and confidential transactions to hide amounts. Zcash uses zero-knowledge proofs and offers optional "shielded" transactions alongside transparent ones.

Privacy coins have legitimate uses, from protecting salaries and business payments from public view to safeguarding people in repressive countries. But regulators worry they make money laundering harder to detect. Several exchanges in different jurisdictions have delisted privacy coins or restricted them to meet anti-money-laundering rules, so they can be harder to buy and sell. Even with Bitcoin, privacy techniques such as CoinJoin exist, though they are often scrutinised by exchanges.