Cashfusion - Bitcoin Cash Privacy Explained

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CashFusion is a privacy-enhancing tool for the Bitcoin Cash (BCH) blockchain that allows users to "fuse" together multiple small transactions into a single, larger transaction, making it more difficult to track the origin of the funds.

This is accomplished by creating a so-called "Fusion transaction" which combines inputs from multiple transactions into a single output. The inputs are then "locked" in such a way that they can only be unlocked by the person or entity that knows the secret key(s) associated with them.

The advantages of using CashFusion include improved privacy and fungibility for users of the Bitcoin Cash blockchain, as it makes it more difficult for outside parties to track the origin of funds.

Additionally, it has the potential to reduce blockchain bloat by reducing the number of transactions required to move a specific amount of funds.

The use cases for CashFusion include anyone who wants to keep their financial transactions private, such as businesses, individuals, and privacy-conscious organizations. It is also useful for people who want to increase the fungibility of their Bitcoin Cash, so it can't be easily tracked or blacklisted.

As for improvement, Cashfusion is currently in an experimental stage, and one of the key improvements would be to make it easier to use for general population.

Another area of improvement would be to improve its scalability so that it can be used by more people simultaneously, or increase the maximum number of inputs per Fusion transaction.

Is privacy essential on Bitcoin Cash?

Privacy is not a requirement for the functioning of the Bitcoin Cash (BCH) blockchain, but it is an important feature for many users.

Transactions on the BCH blockchain are public and can be viewed by anyone on the network. This is one of the key features of the blockchain that allows for transparency and trust in the system, but it also means that transactions can be tracked and potentially linked to an individual or entity.

For some people or organizations, this level of transparency may not be desirable, as they may have reasons for wanting to keep their financial transactions private.

Privacy is also important for the concept of fungibility, which refers to the ability of one unit of a currency to be interchangeable with another unit of the same value. If certain units of a currency can be traced back to specific individuals or activities, they may be considered less valuable or "blacklisted" by certain parties, which can lead to reduced fungibility.

Cashfusion is for now supported by the Electron Cash wallet, a thin light weight but powerful Bitcoin Cash wallet. Others BCH wallets aren't supported yet by the protocol.

Bottom Line, privacy is not essential for the functioning of the Bitcoin Cash blockchain, but it is an important feature for many users who want to keep their financial transactions private, or who want to ensure the fungibility of their funds. Privacy-enhancing tools like CashFusion can be used to improve privacy on the BCH blockchain.


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