DarkCoin (DRK), an alternative to Bitcoin, is now the first cryptographic currency to offer anonymous transactions. Developers of the currency, which launched in January, revealed the first release candidate of Darksend on Good Friday, offering a new transaction system that will ensure private transactions for individuals using the currency. The price rose from weekly averages of $ 0.60US to above $ 1US upon news of the development.
While Bitcoin allows users to transact from pseudonymous digital addresses, all Bitcoin transactions are recorded in a public ledger called the “blockchain”. The public blockchain allows third parties to track payments from any digital address, making it possible to determine a user’s transaction history, their trading partners, and their wealth as well as with the aid of monitoring technology, their location and other information.
DarkCoin developers have built a new system of exchange based on the “CoinJoin” theory, first described by cryptocurrency developer Gregory Maxwell. The system mingles unrelated transactions in the blockchain ledger. The “proof-of-work” decentralized verification system integral to cryptocurrencies continues to operate but the mingled blockchain prevents third parties from discovering which digital addresses were involved in any individual transaction. The payer sends the amount, the payee receives the amount but third parties cannot find the direct connection between the two. Masternodes host the Darksend network and the voluntary nodes will begin to receive incentive payments starting from the next release candidate.
“When making payments with Bitcoin it’s like leaving your checking account open in your browser and everyone on the internet is able to see what you bought,” says DarkCoin developer Evan Duffield. “It’s really a shame the original development didn’t aim to prioritize the user’s privacy. This is where Darksend comes in, we can use this technology to enhance the personal privacy of users of the network.”
Darksend provides users with increased privacy while maintaining the transaction speed of current cryptocurrencies. The solution is trustless due to the decentralized network and does not rely on existing third party coin mixing services. Privacy and anonymity are built into the Darksend model.
There are currently just over 4 million Darkcoin in circulation, compared to the 12.6 million Bitcoin currently mined. Darkcoin is estimated to reach a maximum supply of 22 million coins sometime next decade.
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