Dash PrivateSend Explained
Last Updated: 1st November 2018
PrivateSend is a decentralized coin mixer feature on the Dash protocol that is designed to enhance user financial privacy by obscuring the origin of funds. The purpose behind PrivateSend is to maintain the fungibility of Dash coins by removing its history on the network. This is important because fungibility is a key characteristic that enables any currency to be freely exchanged. Without fungibility, there is a risk that a certain portion of a cryptocurrency’s total supply could be blacklisted, with some users refusing to accept some coins because they may have been associated with transactions that involved illegal activities. Dash’s PrivateSend has been devised to tackle this issue, by completely obfuscating the origins of users’ funds.
PrivateSend Works in the Following Way:
Firstly, the PrivateSend function begins by breaking down a user’s transaction input into discrete standard denominations, with these denominations being: 0.01 DASH, 0.1 DASH, 1 DASH, and 10 DASH. A user’s Dash wallet will then initiate a request to a Dash masternode, so that it is made aware that a user would like to mix a certain denomination of Dash coins. The masternode will then issue a message to the network indicating that is ready to mix a denomination, and that there is a user waiting. Two other individuals, who also wish to mix the same denomination of Dash coins, can connect to the masternode that is hosting the other user’s transaction, and a mixing session can commence. Within the mixing session, the masternode mixes up the inputs, and instructs all three users’ wallets to pay the now-mixed input back to themselves. A user’s wallet must repeat this mixing session multiple times (each time is called a round), in order to ensure that fund origins are fully anonymized. Finally, it is also important to note that funds involved in the mixing process never leaves a user’s wallet, ensuring that the entire process can remain trustless and secure.
