Vitalik Buterin has put forth a fresh proposal designed to enhance user privacy on Ethereum while minimizing significant alterations to the network.
In a post dated April 11 on the Ethereum Magicians forum, Buterin, a co-founder of Ethereum (ETH), outlined how wallets and developers can make incremental yet impactful advancements to user privacy without having to rely on extensive updates to the core protocol. His post highlights the necessity of integrating privacy-enhancing tools such as Railgun and privacy pools directly into existing wallets.
Rather than developing standalone applications, the objective is to seamlessly embed privacy features into users’ transaction activities. Wallets could incorporate shielded balances and enable users to perform transactions privately by default.
To facilitate this, the roadmap calls for the adoption of FOCIL and EIP-7701, two technical enhancements aimed at simplifying the implementation of privacy protocols like Tornado Cash and Railgun, removing the need for centralized relayers.
Additionally, the plan emphasizes privacy at the user experience (UX) level, advocating for users to adopt a distinct wallet address for each application they engage with. This approach would make it more challenging for external observers to connect an individual’s activities across various platforms.
The proposal also addresses privacy enhancements for applications interfacing with the Ethereum network. Currently, trusted execution environments could be employed to safeguard user data, but Buterin envisions a future switch to private information retrieval, a more robust solution that has yet to reach sufficient efficiency for practical application.
This proposal does not require modifications to Ethereum’s foundational layer, making implementation more feasible. However, some of the suggested alterations may lead to trade-offs regarding user experience and convenience, potentially hindering widespread adoption.
This initiative coincides with a period of pressure on Ethereum’s market performance. As of April 11, Ethereum is trading at approximately $1,547, reflecting a 20% decline over the preceding two weeks. The cryptocurrency ended Q1 down by 45%, and it has seen a 77% decrease against Bitcoin since December 2021, according to recent data.
One analyst pointed out that recent updates are making it increasingly difficult for typical investors to grasp the project’s roadmap. Although many alternative cryptocurrencies have outperformed Ethereum, its progress has slowed, partly due to ongoing changes and vague communication.
The analyst also noted that intensified competition from newer, more user-friendly blockchains is contributing to Ethereum’s declining price.