Between recent FinCEN proposals to regulate self-hosted wallets and the rocketship growth of companies like Chainalysis, how confident are you that censorship resistant on-chain activity will be possible in a decade?
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I think the government will eventually come to the terms with the fact that on-chain privacy is a requirement. There are a number of technologies that can pull that off in earnest, but my main worry is we’ll settle for “privacy theater” (e.g. unique addr per transaction) instead
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Tbf most people in the cryptocurrency world right now who do actively participate don't know about derivation paths and how they can generate multiple priv/pub key pairs from their seed.
Getting people aware of that is a first step of many.
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You seem to be missing my point: that only provides the illusion of privacy:
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Replying to @bascule and @matthew_d_green
Per your point about Chainanalysis, using a unique address per transaction provides practically nothing against a graph clustering adversary, particularly one correlating on-chain data with other social graphs
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Oh, not disagreeing. I agree with your points. just think there are many steps involved with getting privacy or security of whatever people are trying to protect themselves from. And obfuscation is better than nothing at all.
I think most everyone agrees to Kerckoff's principle.
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Even if it did work well, leaving everything split as a separate UTXO rather than consolidating it for 1 sat / byte can end up costing you a lot of money in fees. There's a significant incentive to merge UTXOs with a slow speed transaction when it's cheapest to save money later.