How Do Stealth Addresses Work in Privacy Coins?
Stealth addresses are a cryptographic technique used to obscure the recipient's public address on the blockchain. For every transaction, the sender generates a unique, one-time destination address for the recipient.
Only the recipient can scan the blockchain using their private view key to identify funds sent to them. This ensures that the recipient's main public address is never directly exposed on the public ledger, breaking the linkability of transactions.
Glossar
Addresses
Ledger ⎊ Within cryptocurrency ecosystems, a ledger represents a distributed, immutable record of transactions, fundamentally underpinning the integrity of digital asset ownership and transfer.
Stealth Address
Anonymity ⎊ Stealth addresses represent a privacy-enhancing technique within cryptocurrency transactions, functioning as a derivative of a user’s public key to obscure the actual sending address.
Cryptographic Technique
Anonymity ⎊ Cryptographic techniques, within cryptocurrency, options trading, and financial derivatives, frequently employ zero-knowledge proofs and homomorphic encryption to obscure transaction origins and amounts, enhancing privacy while maintaining verifiability.
Stealth Addresses
Anonymity ⎊ These cryptographic constructs allow a sender to transfer funds to a recipient's public address such that only the recipient can determine the actual receiving address used for that specific transaction.
Privacy
Anonymity ⎊ Privacy within cryptocurrency and derivatives contexts centers on obscuring the link between transaction origins and identifiable entities, a critical distinction from traditional finance’s reliance on Know Your Customer (KYC) protocols.
Private View Key
Access ⎊ Private View Key is a cryptographic credential that grants an authorized party the ability to decrypt and view the otherwise obscured transaction details associated with a shielded address or encrypted data structure.