American payments giant Mastercard has filed a new patent for Private Blockchain Transactions by anonymizing transactions on a blockchain. which can hide both the point of origin and the amount of transaction. Reported in an application published by the United States Patent and Trademark Office (USPTO) Dec. 9
“The use of one or more intermediary addresses to obscure the source and destination of funds in a blockchain transaction”, according to filings.
How It Works?
This new system works by using an intermediate address during a transaction that interacts with the public key. The intermediate transaction data will be stored. Thereafter a new transaction and digital signature will be created using a private key. The new transaction data, which will contain the destination address and the payment amount, would be then finally be sent.
Patent For Private Blockchain Transactions-The new method “would result in showing the user only transferring funds to and receiving funds from a small number of addresses that are also involved in a significantly large volume of transactions with various other users, thereby rendering the data innocuous,” according to the patent filings.
This may “result in showing the user only transferring funds to and receiving funds from a small number of addresses that are also involved in a significantly large volume of transactions with various other users, thereby rendering the data innocuous.”
But In Reality?
Many users prefer to transact in cryptocurrencies due to the advantages of anonymity that blockchain transactions can offers. Further, Mastercard explains “specifically, it is often extremely difficult to identify the user behind a blockchain address, meaning that an individual can transfer or receive funds utilizing a blockchain while keeping a high level of anonymity.”
However, most of the blockchain ledgers are not actually anonymous. The patent states that transactions can be traced due to the nature of the blockchain as an immutable ledger.
“For instance, such data may, as it is accumulated and analyzed. Meantime it reveals the user behind a wallet or at least provide information about them. However, the existing communications and attribution structure of blockchain technology such as bitcoin require identification of where the transactions are emanating and terminating, in order to maintain the ledger. Thus, there is a need for a technical solution to increase the anonymization. And the wallet user should be kept in secret data.”