Welcome to the lecture Privacy Preserve and Cryptocurrencies.

We are now in lecture 19 and my name is Dominik Schröder.

So let me review what you've seen in the last lecture and let me discuss what we're going

to do in this lecture.

So in the previous lecture you have basically seen a full formalization of ring confidential

transactions.

And as you remember ring confidential transactions are the basics of Monero.

We have essentially discussed in depth the underlying security model and as we discussed

there, it's essentially the first security model that was proposed by our group which

covers all the security properties of Monero so far.

We then discussed the generic construction and afterwards a specific and efficient insensation.

This in fact concludes the part of Monero.

In this part of the lecture which is also the main last section of this class, we will

introduce zero-cache and define the interfaces.

And in the upcoming lectures afterwards we will also discuss the construction of zero-cache

and also discuss where the security properties are coming from.

But before doing so we will essentially start with a little bit of introduction and remind

you a review and remind you what we did so far in this lecture and where we are.

So we started our journey with some basics and here we basically discussed simple crypto.

As you've seen in the past lecture we discussed quite more advanced stuff that is currently

used.

We introduced basic things like math, bitcoin and blockchain.

That was essentially the first quarter of the lecture.

The second quarter, in the second quarter we started discussing the techniques that

are compatible with bitcoin.

In particular we looked at things like mixing, coin join, coin shuffle, zero coin and tumble

bit.

The third quarter of this lecture which was also one of the main topics where we are working

on is the formalization of Monero.

You have seen the ring confidential transactions, the security model and construction.

So until now we have essentially covered three-fourths of the entire class and what we are going

to do next is discuss the missing piece which is zero cash.

So let me start with a little motivation and the little motivation consists of discussing

the previous approaches, the pros and cons and also the motivation why there is a need

for a different approach.

The first thing that you have seen is essentially zero coin which can be seen as the

as the first work that led to zero cash afterwards.

So the main motivation here is essentially to create something like a cryptographic mixer.

If you remember essentially we started with some base coin and zero coin and there was

some conversion mechanism between these two things.

So zero coin itself that was not a currency it was just a mechanism to break the link

between the base coins.

However, this approach had several drawbacks.

Let me discuss the drawbacks.

First of all it only works with fixed denominations.

And this is kind of ugly because you essentially have to break it down to a very tiny piece

and if you want to be very bright and you may have to submit many many coins instead

of just making one transaction with just making one transaction with the concrete amount.

Another big drawback of this approach is essentially that the payment is only and does not work

in zero coin itself.