Series: Zero to Zero Knowledge
An interesting one today!
The CryptoNote protocol enables strong on-chain privacy. Today we learn all of its key features and how it has been implemented by several notable privacy projects.
The original CryptoNote whitepaper was published under the pseudonym "Nicolas van Saberhagen".
Bytecoin was the first cryptocurrency to implement the protocol. The most well-known project using it today is Monero (XMR). It has also been used in TurtleCoin, Aeon, and several others.
The CryptoNote Protocol provides three main features:
Untraceability is primarily achieved using Ring Signatures.
When sending a transaction, your real public key is mixed with several decoy keys (the "ring") - all containing the same amount of coins. This makes it extremely difficult to determine who actually sent the coins.
Ring size significantly affects the anonymity set. Larger rings provide better privacy.
Comparison with Zcash:
Zcash’s anonymity set is the total number of transactions ever made in a given shielded pool (much larger than typical CryptoNote ring sizes).
The Ring CT model greatly improved privacy in CryptoNote-based coins.
Instead of only hiding the sender, Ring CT also obfuscates the transaction amounts between sender and recipient.
It uses:
Proofs are used to show that the amount is greater than 0 and within valid ranges without revealing the actual values.
Stealth Addresses also add one-time use addresses for the recipient.
CryptoNote aims to create a fairer mining system by being resistant to ASICs.
It uses the CryptoNight algorithm (a memory-hard function). Unlike Bitcoin’s SHA256, CryptoNight is designed to close the gap between CPU, GPU, and ASIC miners.
CryptoNight steps:
(Note: Monero has since moved away from CryptoNight to other algorithms.)
Instead of sudden halving events (like Bitcoin), CryptoNote uses a smoothly decreasing block reward.
This creates a much smoother emission curve over time.
Zcash Connection:
Zcash developers have discussed implementing a smoother emission curve in the future, potentially through a "Zcash Posterity Fund".
CryptoNote has proven to be a strong and battle-tested approach to on-chain privacy. Many of its innovations have influenced the broader privacy coin ecosystem.
Some researchers believe CryptoNote features could eventually be combined with trustless zero-knowledge shielded pools.
Original Thread by ZecHub (@ZecHub)
https://x.com/ZecHub/status/1636473585781948416
This page was compiled from the original Zero to Zero Knowledge thread for the ZecHub wiki.