Hidden addresses or Stealth Addresses They will allow “semi-anonymous” transactions to be made that will remain hidden from everyone except the participants.
Vitalik Buterin, founder of Ethereum, has presented a new idea for a possible functionality for the blockchain, "Stealth Addresses” or “hidden addresses”, which will allow the implementation of a simple, low-tech solution (low tech) with which to implement privacy functionalities for NFT transactions.
In a published article On his research page, Buterin explains that extensions to Merkle trees, Zero-Knowledge Succinct Non-Interactive Arguments of Knowledge, and zk-SNARKs are technologically very complex methods to hide the transaction addresses of ERC-721 tokens.
Buterin proposes a own solution, much simpler at a technological level that allows you to hide the addresses of digital wallets compatible with smart contracts, so that only those involved in a transaction can identify the addresses involved.
“You could, for example, send an NFT to vitalik.eth without anyone except me (the new owner) being able to see who the new owner is,” Buterin explains in the article.
The reason why ERC-721 tokens do not need Merkle trees or privacy systems like zk-SNARKs is that each of these tokens is unique, so there is no possibility of creating an “anonymity set”.
How do Stealth Addresses work?
Each Stealth Address It consists of a hash of a user's address, the token ID, and a user's unique secret parameter. The assets are stored at an address that is derived from the user's "leaf" within the hash tree that contains the blockchain data.
Wallet addresses are “pseudo anonymous” as they are linked to a person who may be unknown to the general public, but is linked to that address. This means that, Through block analysis tools they can be easily tracked.
Basically, hidden directions require that the sender create a random, unique address for each transaction on behalf of the receiver, so that different payments made to the same beneficiary cannot be linked and are impossible to trace.
The most basic scheme of a hidden address system was created by “ByteCoin”, a member of the Bitcoin Forum in 2011 and uses the Elliptic Curve Diffie-Hellman (ECDH) protocol.
With the implementation of a new security mechanism such as the “Stealth Addresses”, Ethereum Souldbound tokens, based on ERC-721 token format They can become completely anonymous, which makes their use safer and improves the decentralization of this new token concept.
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