“Tornado [Cash] has passed, but privacy remains,” one crypto enthusiast mentioned on X following the launch of Oxbow’s Ethereum privacy tools on April 1, designed to enable on-chain privacy while distancing from illicit funds.
This viewpoint is supported by the early popularity of the privacy pools, which have recorded 238 deposit transactions, amounting to 67.49 ETH within the first three days. The innovative tool has garnered approval from Ethereum founder Vitalik Buterin, who was one of the initial users to deposit ETH.
These privacy pools utilize zero-knowledge proofs and commitment schemes to allow ether deposits and withdrawals, either partially or fully, while severing the connection between the deposit and withdrawal addresses. It’s akin to having a dedicated bank account where you can transfer money without revealing your identity or the total balance you possess.
The system features three layers: a contract layer that manages assets, a zero-knowledge layer for ensuring privacy, and an association set provider layer that maintains compliance by vetting sources of funds.
These layers collaborate to uphold privacy while scrutinizing transactions for connections to illicit actors such as hackers, phishers, and scammers. Importantly, the screening process is adaptable; if a deposit is accepted and later identified as malicious, it can be retracted.
Privacy pools operate on a non-custodial basis, allowing users to maintain complete control over their funds. This means even rejected deposits can return to their original addresses.
Currently, the deposit limits range from 0.1 ETH to 1 ETH, with intentions to raise these caps following the initial testing phase.
“This is just the start. The journey to normalize privacy is lengthy and thrilling, and we can’t do it by ourselves!” was the message shared on X.