February 4, 2022
What is privacy?
Privacy is not secrecy. A private matter is something one doesn’t want the whole world to know... Privacy is the power to selectively reveal oneself to the world. - Eric Hughes
Privacy is about keeping some things to yourself, which may include your actions. For example, messaging friends privately so they know who sent the message, but only they can read it.
In the case of cryptocurrencies, a private transaction is one where third parties do not know the amount of money, as well as the reason for which it is paid.
Anonymity, on the other hand, is about keeping your identity private, but not your actions. For example, use a pseudonym to post messages on a social media platform.
Returning to the example of cryptocurrency transactions, an anonymous transaction is one in which neither the sender nor the receiver is known to third parties.