Vitalik Buterin, co-founder of ethereum (ETH-USD), has proposed a so-called “stealth address system” to improve the blockchain users’ privacy in terms of transferring funds through the network, according to his recent blog post.
“One of the largest remaining challenges in the Ethereum ecosystem is privacy,” Buterin wrote. “By default, anything that goes onto a public blockchain is public.”
As such, the proposed system would allow blockchain users to conduct cryptocurrency or non-fungible token (NFTs) transactions privately by creating “stealth addresses.” A “spending key” must be used to gain access to the private transactions.
The new system, Buterin noted, would differ from the privacy-focused functionalities provided by crypto mixers such as Tornado Cash, which was sanctioned by the U.S. Treasury Department in August 2022 for its alleged use in laundering virtual currency stolen by North Korean hackers.
Tornado Cash, which enables users to hide their transactions on ether (ETH-USD), is “very weak at adding privacy to transfers of obscure ERC20s, and it cannot add privacy to NFT transfers at all,” he explained.