This is false. If I go out on a date and my date sends me money on chain, I now know their public key and can look up every past and future transaction they make.
If they send me cash there’s no way the cash will help me do that.
This is not how things HAVE to be, it's just the default of a public ledger.
I'm actually working on making private payments on public blockchain with zk right now, and it's nowhere impossible, just technically complex. Should be live on peanut.to in early Jan.
Venmo is a centralized provider that doesn't _work_ in non US countries. That's not good.
One is an open system where public transactions need much more sophisticated cryptography to be private while remaining auditable. The other is a proprietary closed system. They are not the same.
You would have been able to use something like Tornado Cash outside of the US in order to conceal previous/future transactions from people you interact with. The US has decided that's illegal. Not sure what Ethereum could do about that.
zCash and similar cryptocurrencies take a different stand where transactions can be "shielded" and anonymous.
If you think wanting to hide previous/future transactions from other private entities is money laundering and illegal, I think you need to re-educate yourself on how that stuff works.
Money laundering is trying to hide the source or nature of illegal activities. Privacy in itself is not illegal nor money laundering.
But investigating money laundering and certain forms of organized crimes is extremely hard without being able to trace transactions. There's no point in having laws if they can't be enforced.
That's why a limited amount of privacy is all that governments with these kind of laws could possibly accept. That is: privacy from other private individual and organizations, and from the government as long as they don't have a court order to look into your transaction.
It might be possibly to design a cryptocurrency that satisfies government requirements, and maintains a balance between privacy and ability to investigate economic crimes, but I don't think most blockchain developers is interested in that.
Yes, I think many crypto fans conflate anonymity and privacy.
however like any anonymous system, once your identity has been associated externally, you lose the privacy garnered by it.
The argument would be then to create many burner wallets but that’s also not exactly scalable unless you’re transferring between them off the chain to avoid gas fees.
This is false. If I go out on a date and my date sends me money on chain, I now know their public key and can look up every past and future transaction they make.
If they send me cash there’s no way the cash will help me do that.
Heck, even Venmo has protections against that.