On April 13, Zcash advisor and assistant director of IC3 Andrew Miller stated that transactions on the Monero blockchain from 2014 through 2016 could be linked.
To begin with, Monero uses decoy links called mixins to obscure inputs and outputs of a transaction. Such process anonymizes Monero transactions as it disables users from following traces of a transaction to its origin, unlike bitcoin.
However, in a research paper entitled “An Empirical Analysis of Linkability in the Monero Blockchain” written by Miller and his team of researchers including Malte Moser, Kevin Lee and Arvind Narayanan, Miller claimed that mixins of Monero did not execute properly prior to February 2017.
“We show that in fact for most of Monero’s blockchain history, the mixins haven’t done much good. Most transactions made prior to February 2017 actually are linkable. Here’s the problem. In the past, most coins were spent by 0-mixin transactions (those that opt-out of privacy altogether) were commonplace. Including these coins as decoys doesn’t do any good, because it’s already obvious where they’ve actually been spent. However, the Monero wallet does not take this into account. The result is that we are able to identify the correct links for the majority (62 percent) of 1+ mixin Monero transactions made from 2014 through 2016. The Monero blockchain has provided little more privacy than Bitcoin,” Miller explained.
Response of the Monero Development Team
Almost immediately after the release of Miller’s research, Monero Lead Developer Riccardo Spagni, better known as Fluffypony, admittedly explained that the issue addressed in the research paper was a well-understood problem by both the Monero development team and community. In that sense, the research paper wasn’t inaccurate. But, Fluffy Pony explained that the research paper was falsely presented as a “Monero deanonymization paper.”
Fluffypony went as far to accuse the president