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ENCOINS: Revolutionizing Privacy on Cardano

In the digital age, privacy and security are paramount, especially when it involves financial transactions. Encoins is set to introduce a groundbreaking innovation on Cardano. This article aims to demystify how it works.
LucasMacchiavelli
Dec 5, 20235 min read1588 views

What is Encoins and why it is Important.

Privacy is a critical concern in the digital world. Traditional public blockchains, while secure and transparent, lack privacy in transactions. ENCOINS addresses this gap by allowing users to conduct transactions privately, without sacrificing the inherent security benefits of blockchain technology. This feature is particularly important for users who require discretion in their financial dealings.

Think of ENCOINS as a special cloak for your digital money on the Cardano blockchain. Just like a cloak makes a person invisible, ENCOINS makes your financial transactions private. When you want to send money privately, you first wrap it in this 'digital cloak,' as an NFT. These hide the amount of money you’re sending. You can then send these cloaked NFTs to someone else on the Cardano network. The clever part is, even though the transaction is recorded on the blockchain, the amount remains a secret. Later, when someone wants to turn their encrypted coins back into ADA, they simply remove the cloak, with a Password sent from the sender to the receiver off-chain. With this password, the true value is revealed, but only to the right person. This way, ENCOINS allows you to enjoy the benefits of a public blockchain, like security and reliability, while keeping your transaction amounts private.

Main steps in using ENCOINS

Using ENCOINS involves 3 key steps:

  1. Minting Encrypted Coins: Users can create (mint) encrypted coins on the Cardano blockchain. These coins represent value but do so privately.
  2. Transactions: Users can transfer these encrypted coins to others, ensuring that the amount transferred remains private.
  3. Burning and Redeeming: Users can 'burn' these coins, converting them back into ADA, maintaining privacy throughout the process.

Mainnet Release

ENCOINS is now live on Mainnet! Here is a brief tutorial on how to send Transactions using ENCOINS. Please keep all the keys you are going to be given and first try this out with little ADA, so you reduce risk as much as possible. Here is the Link to the app: https://app.encoins.io/

Minting and Burning Coins (Wallet Column)

  1. To mint new coins, enter their ADA values one by one and press "+" to add the coin to the current transaction. (In this case, I did 3 Coins: 1 worth 10 ADA and the other 2 worth 0.) From the outside world its not possible to see how my 10 ADA are distributed. Meaning nobody can determine how much each of them is worth.
  2. Next step is to click the big "SEND REQUEST" button, which will open up your wallet to deposit the ADA + fees.
  3. After the transaction goes through, you will have all your minted encrypted NFTs in your wallet and they will display in the left column.

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Sending Coins from the App: (Transfer Column)

  1. Now go to the Transfer Column. Select the coins you want to transfer and press "Send to a Wallet".
  2. Copy the minting keys, which are the password to reveal the NFTs' Value (DON'T LOSE IT). If you are trying this with someone else, now you have to send them this password.
  3. Choose the recipient's wallet address and sign the transaction in your wallet.

Receive and Claim your tokens

  1. Now you are on the receiver's end, connect to the app with that wallet.
  2. In the Wallet column, import the key you were given in step 2.
  3. Now you will see the revealed value of the NFT. To claim it, click the NFT on the left column and on the right column, you are going to create a new coin worth 0 ADA. Press "Send request" to initiate the transaction, pay the fees, and you are ready! You have successfully moved ADA between two wallets in a private way.

Conclusion

ENCOINS introduces a revolutionary approach to privacy in financial transactions on the Cardano blockchain. It stands as a testament to the evolving nature of blockchain technology, addressing the critical need for privacy in digital transactions. As the world moves increasingly towards digital currencies, solutions like ENCOINS are pivotal in shaping a future where financial transactions are both secure and private.

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wen_b_
2 months ago

And how about receiver transparency? I mean if someone is following my wallet activity will the recievers be hidden somehow? ie. recievers would just be Encs app wallet or something like this?

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wen_b_
2 months ago

So in order to fool the spy we always need to make dummy transactions too (the zero ada)?

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lastofcardano
3 months ago

nice read indeed!

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lamvoi
3 months ago

so total amount of ADA minted we could check on-chain. We just dont know the value of each minted NFT until someone burns it. Is that right?

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