Vitalik Buterin Finds A Balance Between Anonymity And Crypto Regulators
The Ethereum founder has written a new research paper that reveals an approach to balancing crypto regulation and anonymity.
The new "Privacy Pool" concept described by Buterin will make it possible to prove that users' crypto funds come from legitimate sources without revealing their identity. Zero-knowledge proofs will play a role in this, confirming that withdrawals are associated with previously approved deposits.
This approach allows honest market players to dissociate themselves from criminals and confirm their legitimacy while remaining anonymous.
The protocol can meet the needs of any regulation, and users can customize the level of personal information disclosure. Therefore, Buterin once again expressed his desire to build a better relationship between the crypto community and regulators.
The paper details the workings of its protocol, which consists of associative sets. They are built on inclusion and exclusion models. Buterin and his team will perform additional research.