Justin’s Orb
Orb has ended
0xF719••035E
#1

Posted on Farcaster: https://warpcast.com/polymutex.eth/0x5e4d954e sha256: 5ad309be5a8d2ece94c65fcccdc5238d1913e9da088e9fd082e8c879fd9b60a6

Justin's Response

Ok, privacy thoughts below! Disclaimer: I haven't spent much time thinking about privacy so take the following with a grain of salt :)

  1. As a technical side note, Vitalik's roadmap diagram does have in-flight privacy in a couple places: "Secret leader election" under The Merge, and "encrypted mempools" under The Splurge. These provide transient privacy for proposers and users respectively, and are important for robustness in the context of censorship and MEV.
  2. I'd say there's rough consensus within EF research that privacy is best handled at L2, not L1. L1 provides enough programmability for L2s to eventually host private applications. One of the design philosophies of L1 is to provide basic building blocks (such as BN254 pairing checks) upon which fancy apps can be built. The L1 is also too expensive to use—the future of privacy lies within L2s such as rollups and validiums.
  3. While we definitely need privacy in the long term, the lack of privacy in the short term does have advantages—we might as well embrace those :) Transparency makes it easier to detect bugs (including supply inflation bugs), makes a bunch of tradworld folks (regulators, tradfi, law enforcement, boomers) more comfortable, and allows entrepreneurs to build cryptography-light apps and experiment faster.
  4. Being transparent in the early days may be a strategic move to penetrate society, a sort of Trojan horse. Look at Zcash getting deplatformed from exchanges: maybe Ethereum needs to grow "too big to deplatform" before the fight for privacy can start in earnest.
  5. If I were to choose a priority list for solving blockchain problems I'd probably choose security first, then scalability, then privacy. Scalability is not super meaningful without security, and similarly privacy without scalability is just a luxury for the rich. We're doing extremely well from a security standpoint (10x more economic security than Bitcoin) and IMO now is the time to nail scalability.
  6. I believe the industry is still a little immature to properly tackle privacy. We struggle to even build bug-free and usable transparent apps, and private applications are 10x more complex. The cryptography is evolving extremely fast but IMO still not mature enough. There may also be a lack of demand from users: the majority of users still just want to speculate, with privacy as an afterthought.
  7. True privacy is extremely hard to pull off because a single accidental leak is enough to compromise it. Don't have a good Tor or VPN setup? 💀 Accidentally reused an address? 💀 Subtle cryptographic or design bug? 💀 Just like bridges blow up and lead to mass hacks, I worry that when a privacy app or platform messes up mass leakage of sensitive information will ensue. Users having the illusion of privacy is probably worse than users knowing full well they have no privacy.
  8. One of the recent concerns is that Aztec may wholesale be added to the OFAC SDN list, with builders and relays censoring Aztec blobs. Roughly 2/3 of blocks are built by censoring builders, so if Aztec (as a rollup) was to go on the SDN list that would reduce its max capacity (and increase settlement latency) by 3 relative to other rollups. I believe builder and relay censorship is something we should fix ASAP and is definitely one of my priorities.
  9. In summary, I agree with you that privacy is extremely important as Ethereum adoption grows and I'm optimistic we will eventually enjoy widespread high-grade privacy. Having said that, I don't think tackling it at L1 is the right move and from a timing perspective it may even be too early for L2s to tackle.