Charlie Lee to Add Optional Privacy to LTC: Confidential Transactions on Litecoin planned for 2019
Two of the top narratives in crypto circles is bitcoin’s low transaction speed and lack of privacy and by extension fungibility.
With Lightning Network‘s excellent progress, the transaction speed or lack thereof can be checked on the list of things bitcoin needs to work on. Next stop: fungibility.
That is the thinking of Charlie Lee, Litecoin founder and former Coinbase executive. Litecoin is bitcoin’s clone with a few hardcoded cosmetic changes, so anything bitcoins has issues with, litecoin does too.
As mycryptopedia explains, confidential transactions are a brainchild of Adam Back, current CEO of Blockstream.
“Conceived by former Bitcoin developer, Adam Back, a confidential transaction (CT) is a method of increasing the privacy of a transaction by homomorphically encrypting the inputs and outputs using a blinding factor. A blinding factor is simply a string of numbers that is used to encrypt the inputs and outputs of a Bitcoin transaction.
In essence, confidential transactions allow only the two parties partaking in a transaction to be privy to the amount being transacted, outside observers are prevented from knowing this information. However, the network must also be able to determine the validity of a confidential transaction. This is achieved by ensuring that the number of inputs in the beginning of a transaction is equal to the number of outputs at the end of the transaction.”
Confidential Transactions are one of the major features of top privacy coin Monero and are already battle tested.
As for the timeline of implementing CTs into Litecoin codebase, Charlie Lee answered it will be sometime in 2019. The implementation won’t require a hard fork as Lee says it can be done via soft fork.
However, the CTs will not be mandatory, rather an optional feature, similar to what Zcash does with its shielded and unshielded transactions.
