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In this installment of The Protocol, we're continuing our coverage of the latest developments in cryptocurrency technology. This week, we're diving into the ongoing discussion among Ethereum developers regarding privacy.

After the U.S. government sanctioned the Ethereum-based crypto mixing service Tornado Cash in 2022, members of the crypto community argued that complying with the sanctions amounted to censorship.

The move also brought to light a broader cypherpunk principle: technology should be developed with privacy in mind.

The move also brought to light a broader cypherpunk principle: technology should be developed with privacy in mind.

President Donald Trump supported the cypherpunks and lifted the sanctions on Tornado Cash in March of this year, but for some Ethereum developers, the situation highlighted a flaw within the network that still exists today: Why should users depend on third-party apps to transact privately on the network?

Perhaps emboldened by the recent Tornado Cash developments, Ethereum developers and researchers have once again begun discussing ideas for making the Ethereum network private at its core.

"Privacy must not be an optional feature that users must consciously enable - it must be the default state of the network," said PCaversaccio, whose post outlined his vision for a privacy-oriented Ethereum roadmap. "Ethereum's architecture must be designed to ensure that users are private by default, not by exception."

In response to PCaversaccio's post, Ethereum co-founder Vitalik Buterin left a comment on the network's main developer forum with his own much shorter privacy-oriented Ethereum roadmap. Buterin suggested focusing on privacy for on-chain payments, anonymizing on-chain activity within applications, making communication on the network anonymous and privatizing on-chain reads.

To achieve all of this, Buterin listed various steps like integrating certain third-party privacy features into the core network. For example, Buterin said that "the simplest and fastest route to usable on-chain privacy is to integrate Monero-style ring signatures into the blockchain."

Buterin also suggested introducing a variant of the blockchain privacy technology used by the Beam and Haven protocols, which are both focused on privacy-oriented blockchain protocols.

Both protocols use a variant of the blockchain privacy technology known as Mimblewimble, which was originally developed by Andrew Poel in 2016. Mimblewimble is designed to make blockchains more efficient and private by removing data that is no longer relevant.

Buterin said that a variant of Mimblewimble could be used to create a "layer 2 optimistic rollup focused on on-chain payments."

"The simplest and fastest route to usable on-chain privacy is to integrate Monero-style ring signatures into the blockchain," Buterin said. "We can also look at adding in a variant of the Beam/Haven technology, which allows users to easily and rapidly create new coins via on-chain atomic cross-chain composability."

Buterin's suggestions come as interest in blockchain privacy is heating up. Earlier this year, a group of researchers at the University of California, Berkeley, developed a new technique for making blockchain transactions more private. The researchers, who are affiliated with the university's Center for Human Rights and Deployment of Advanced Technologies, used a type of differential privacy to protect the identities of blockchain users while still allowing researchers to analyze the transactions on the blockchain.

Differential privacy is a technique that is used to analyze data sets while preserving the privacy of individuals in the data. It works by adding random noise to the data before it is analyzed. The amount of noise that is added depends on the sensitivity of the data and the level of privacy that is desired.

In their paper, the researchers used differential privacy to analyze transactions on the Ethereum blockchain. They were able to identify patterns in the transactions without being able to identify the individuals who made the transactions.

The researchers said that their technique could be used to study a variety of topics, such as the way that cryptocurrency is used for criminal activity or the impact of cryptocurrency on economic development.

"We believe that this work has the potential to make a significant contribution to the field of blockchain privacy research," said Sameer Parikh, one of the researchers who worked on the project. "We are excited to see what other researchers will do with this new technique."

The researchers' work is part of a broader effort to develop technologies that can be used to protect privacy in the digital age. As technology becomes more advanced, it is increasingly possible for governments, corporations and other institutions to collect and analyze vast amounts of data about individuals. This has raised concerns among privacy advocates, who argue that this data could be used to infringe on people's privacy and autonomy.

In response to these concerns, researchers have been working to develop new technologies and legal frameworks that can be used to protect privacy. This research is focused on developing technologies that can be used to minimize the amount of personal data that is collected and to ensure that any data that is collected is used in a fair and transparent manner.

The researchers who developed the new technique for analyzing blockchain transactions believe that it could be a valuable tool