Since a downzap whale has targeted me for their lack of having actual arguments against my "Privacy Paradox" framework, and I have had to reference my prior Privacy Paradox comments several times in the last few days, now seemed like a good opportunity to slop-synthesize that view.
This will be downzapped to oblivion, so my gift to you is whale sats as stacker rewards.
The Privacy Paradox
Privacy is paradoxical. Anything marketed, promoted, or adopted primarily for its privacy properties becomes less private by design.
Core MechanismsCore Mechanisms
- Anonset Collapse
Tools whose main value proposition is privacy attract a small, self-selecting set of users who are unusually motivated by privacy and/or particularly bad at threat modeling. The resulting anonymity set is tiny and heavily skewed. Real privacy thrives in large, heterogeneous populations where the privacy-seeking behavior is incidental. - Honeypot Dynamics
Explicit privacy tools become high-value surveillance targets. Adversaries (state or otherwise) rationally concentrate resources on them. Networks with weak or nonexistent Sybil resistance (Tor, Coinjoins are classic examples) are especially vulnerable: a large fraction of participants can be controlled or monitored without detection. The very fact that the tool exists primarily “for privacy” guarantees continuous adversarial attention. - False Sense of Security → Practice Failure
When privacy is sold as a product or protocol feature, users treat it as a solved problem. They stop doing the actual work of privacy: UTXO management, address hygiene, threat modeling, operational security. The system is then deanonymized by the very people who thought the tool would protect them. - Centralization & Coordination Pressure
Privacy is hard, privacy solutions must therefore also claim to make it easy. Easy solutions trend toward coordinated services, trusted setups, or reputation systems that reintroduce single points of failure and observation. The more a technique is advertised as private, the more pressure there is for it to become centrally managed and therefore observable.
ImplicationsImplications
- Privacy should never be the primary marketing claim or design goal of a system.
- Useful privacy is an emergent property of systems that are superior for other, non-privacy reasons (scalability, cost, convenience, censorship resistance, etc.).
- When a technique happens to improve privacy as a side effect, lean into the primary benefits and stay quiet about the privacy angle. Advertising the privacy benefit accelerates the paradox.
- Real privacy remains a practice, not a product, protocol, or app. Tools can only support or undermine that practice; they cannot replace it.
This is why claims that “X is private” or “use Y for privacy” should be treated with extreme skepticism. The act of making the claim is usually self-defeating.
Maybe downzap whale is asleep?
Very European coded so far, so that tracks, or he fucked off until September
you synthesize my tech lack of knowledge about privacy very well, as much I saw tools promoting privacy more I take back 2 steps to see how the “privacy” is applied. Knowing that’s not a completely private at internet, hide in the crowd is my approach. Not a slop and watched social medias or content platforms, this is more about sanitizing your time and make algorithms confuse than privacy.
about bitcoin is different, a used the well known practices for privacy already in our hand, as you said. Lightning and very good management of utxo is enough for me know to start.
I would like to know more about it from you, share here in more detail.
🤯 sheesh mind blown. I was just about to spin up my Wasabi wallet and start coin joining again thanks to the media sat blitz on SN about it.
But this post makes it seem like privacy is just one big hustle to capture naive people into using their products.
This was one of my main critiques of the whole No-KYC argument when everyone has a fiat bank account and get their children a SSN numbers. Then they go on podcasts and do public events yet they guilt trip you into mixing because you bought your Bitcoin on coinbase. And the ledger is forever thus the boogeyman is going to get you in 2055 when you spend!
Take a step further they form VC firms which are highly regulated by the government but yet they still champion privacy for you.
There are surely earnest people working to make useful things more private, I think CLINK for example is more private in many ways by design than alternatives, but I also don't go around telling people that's why you should use it. It needs to be useful in other ways.
Telling people to create an on-chain footprint of their coin going into a pool borders on maliciousness.
As a great and wise man, @Car, once said: "Incentives rule everything around me."
If there were no coinjoins or p2p exchanges the whole chain would eventually be surveiled. That wouldn't be ideal, so I'm glad that the tools are there for us to use. Of course it doesn't mean you can simply do a coinjoin and think that the job is done. There's a lot more to be cautious of like exposing your xpub to a public node or consolidating utxos.
Not true of joins, p2p sure but it's irrelevant scale.
The further you get from a KYC exchange in actual usage the less the attribution signal
If people are just withdrawing -> reciever -> exchange then sure, but add one organic middle receiver and that breaks down. When you actually use coin for commercial activity, every time it changes hands, it becomes less attributable.
Coinjoins are just recycling, not actual usage. Coin in Coin out is obvious because of the recycling, and draws attention all it's own because of the paradox.
There is no shortcut, no coordinator making a vig or crypto-theater solves this problem. It'll only be solved by lightning and real economic activity... And even then really only for individuals and medium businesses, state or institutional level movements are transparent by design, the privacy balance has flipped.
I suppose it's 4d chess to think above the expected layer
Someone invents a privacy tool to keep things private, you don't think the feds are going to reverse engineer that idea to work out what youre doing
Remembering that sha256 our sacred cryptographic holy grail was designed by the feds they try and evade
Probably would've been more purposeful to not buy Bitcoin and major in psychology and point out all the order of effects of why people do the things they do 💁
I slopped this together about a year ago that touches on some of that, if the state itself is your threat model, crypto efforts are largely futile since all the hardware you use is backdoored in ways most can't even begin to imagine: #1008583
Separate discussion, the NSA created Bitcoin
#1241215
The only honest thing I’ve seen in Bitcoin are just businesses, that’s why your better off supporting them than anything else.
Especially the ones that are not kyc/aml you.