In an interview with zkSNACKs, the CEO said he believes Bitcoin privacy will survive despite the impending closure of its CoinJoin coordination service.
In an interview with Cointelegraph after the declaration, Max Hillebrand, the Chief Executive Officer of zkSNACKs, provided an exclusive explanation that the choice was structured to guarantee adherence to the most recent legal and regulatory developments in the United States.
Hillebrand stated that the CoinJoin service’s closure was essential due to the ambiguity surrounding cryptocurrency regulations and the use of privacy-enhancing tools in the United States.
Commentators, including former NSA whistleblower Edward Snowden, expressed their regret over the discontinuation of the service.
The chief executive officer of zkSNACKs stated that the Bitcoin ecosystem would unavoidably lose a crucial service that enabled users to conduct transactions in greater secrecy via the coinjoin mechanism:
“Bitcoin privacy will survive, but cutting back the support from zkSNACKs for Bitcoin developers and privacy educators is a regrettable setback.”
Additionally, Hillebrand affirmed that the Wasabi client, the Bitcoin client that zkSNACKs developed and integrated into the CoinJoin service, will continue to operate as a standard BTC wallet. Users are capable of generating private keys for Bitcoin transactions.
Coinjoin’s Privacy
Hillebrand stated that despite the decommissioning of the CoinJoin service, Wasabi’s client-side filtering architecture, integration with Tor, and custom coin selection continue to provide users with substantial privacy. In the future, CoinJoins will continue providing the highest privacy level available.
Hillebrand conceded, “The nature of the Bitcoin blockchain precludes users from attaining absolute privacy in the absence of CoinJoins.”
The CEO of zkSNACK was reluctant to speculate whether jurisdictions other than the United States would implement comparable restrictions on privacy protocols and CoinJoin services.
The closure of zkSNACK’s CoinJoin coordination service had repercussions on services and products throughout the ecosystem. As of June 2024, Trezor Suite and BTCPayServer hardware services for wallets will be unable to provide the service to their respective consumers.
How CoinJoin Works
At Bitcoin Amsterdam in 2023, Hillebrand detailed zkSNACK’s CoinJoin service in an in-depth interview with Cointelegraph.
To obfuscate Bitcoin transactions, Hillebrand explains that a CoinJoin service combines the inputs and outputs of multiple users into a single transaction, thereby substantially increasing the difficulty for outside observers to discern particular transaction details.
CoinJoin enables the Bitcoin privacy feature on the Trezor wallet.
Extensive research led to the 2018 introduction of the Wasabi Wallet. The wallet ensures anonymity through Tor, checks and balances using a light client approach that does not compromise privacy, and verifies transactions efficiently and securely without requiring the download of the entire Bitcoin blockchain by employing block filters.
