The use of privacy features in crypto currency has been a lightning rod for debate for as long as it’s held a place in popular culture. Indeed, few no-coiners had any frame of reference for Bitcoin before Ross Ulbricht, (aka “Dread Pirate Roberts”), put the now defunct Silk-Road on the map as the place to trade ‘untraceable’ digital currency for black market contraband. Yes, there were any number of illicit substances and services exchanged for BTC on this dark-web market, but it would be too easy to disregard Satoshi’s vision, or other cryptocurrencies as solely useful to grease the wheels of some infernal underground economy, (lest we forget that US tender, and more specifically, the $100 bill, is the favored form of ‘anonymous’ currency among money launderers ). As with most topics that deserve discussion, it’s just not that simple.
When you use online services, like email or web browsing, your data travels across the network and gets stored on servers that belong to those companies. Almost all online services and Internet-connected devices have privacy settings you can update to restrict the amount of information collected and/or posted publicly online.
In a consumer marketplace where attention spans are becoming ever more fractured, politicians and news outlets are quick to promote sound bite-slogans that resonate with their base, instilling a sense of confidence in uncertain times. Often, it makes no difference whether the rhetoric yields an accurate depiction of events, so long as it feels real enough to put on poster board. In such a market, the only thing that can command more fascination than what can help us, is what can hurt us, and fear-stoking content is the lowest hanging fruit. Where the media has been busy inaccurately lambasting Bitcoin as a currency for criminals, the real power struggle has been waging behind the scenes as traditional power structures discern how and where they can leverage blockchain, and other emerging technologies like AI, and 5G networks, to their own benefit. Mainstream media’s often echoed response to privacy enabled transactions is indirectly suspicious at best, “if you aren’t doing anything wrong, you won’t have anything to hide”. Obviously, the need for privacy is far more nuanced than this retort would suggest.
On a fundamental level, for a truly free democracy to persist, the populace must have access to private modes of communication. Privacy enabled transactions are by no means limited to ‘money’. The most meaningful transactions are often transmissions of thought, conversations which result in participants ‘buying’ valuable modes of thinking, and ‘selling’ guidance or other helpful discourse. Without private channels of exchange, ‘freedom’ exists only insofar as the prevailing power structures monitoring communication will allow it. Just ask the victims of the authoritarian regimes swept up from Twitter discourse deemed subversive during the Arab Spring, or businesses defrauded of valuable intellectual property by foreign governments, or casual users of popular social media applications who became the unwitting targets of mass metadata harvests. If we are to have any semblance of trust in the institutions that govern so much of our day to day lives, there has to be a forum where the privacy of the individual is respected.
If you are new to LOKI, the Australian project is self described on their landing page as a “privacy network which will allow users to transact and communicate privately over the internet, providing a suite of tools to help maintain the maximum amount of anonymity possible while browsing, transacting and communicating online”. They accomplish this by combining a private transaction network based on Monero, and distributed service nodes that are rewarded in a hybrid PoW/PoS system. The combination produces a trustless quorum-based protocol which allows for data to be transmitted anonymously through a decentralized network of service nodes. It is worth noting that though LOKI is occasionally misrepresented as a Monero fork, it is not. Though their all star lead developer Thomas Winget is formerly a major Monero contributor, they did not in any way fork from Monero, and are simply based on Monero core code. For this paper, I’d like to focus on the two elements for which the LOKI is most distinguished from other entrants in the privacy coin space, LOKINET, and SNapps.
Pangolin Smart Firewall
The average internet user’s trust in internet service providers and unsecured applications has eroded significantly, even in the last 5 years. Once trusted applications, chat rooms, and social media profiles are now interacted with in suspicion. Wide scale server breaches and data heists have made general sentiment towards the internet mistrustful at best. In my opinion, LOKINET is one of the most important and prescient use-cases for the decentralized, trustless, block chain-enabled tenants championed by crypto-enthusiasts to date. Though a self-admittedly niche interest, LOKINET serves to fill the mixnet short-comings of TOR and i2P, allowing for completely anonymous and encrypted internet browsing.
They accomplish this with the use of service nodes operating a low latency onion routing protocol, providing users with a blockchain-based mixnet protocol, (a first in the market). In instances where privacy is called for, a more elegant alternative to TOR and i2P is overdue. Where TOR is vulnerable due to centralization, and i2P can be unreliable, (and both are vulnerable to Sybil attacks), LOKINET puts forth a model that realizes the strength of both in its service nodes, and combines them with LLARP, (Low Latency Anonymous Routing Protocol), to accomplish a new level of service in private browsing. Given the security needs inherent to other privacy tokens, it would be sensible for projects currently relying on TOR to migrate to LOKINET, increasing the project’s profile, LOKI token value, and network effect.
SNapps, or Service Node apps, are web applications built on service nodes within LOKINET. They can be written in the programming language of the developers’ choice, and function like any other web application, except with the full benefit of LOKINET anonymity and privacy , whereby neither the servers’, nor the users’ IP addresses are ever revealed. Out of the gate, there are a couple of key aspects to note. Programmers do not have to learn an exotic programming language to participate in the LOKINET ecosystem as they would with Ethereum, (Solidity), greatly increasing accessibility to users. SNapps also benefit in comparison to Dapps in that they are not processed on-chain, so they don’t suffer from reduced performance a la crypto-kitty fatigue. Users also do not have to worry about information being stored on-chain for all time.
There is great demand for such anonymous and private application development among any number of common institutional mainstays. Medical information, academic records, legal documents, governmental repositories, whistle blowers, among many others, all call for highly private use. Building an application on an externally available, yet highly secure network would yield a compelling use-case for even the most ardent detractors. If the technical improvements over TOR’s Hidden Services, and Dapps weren’t enough,(and perhaps a buried headline), the use of SNapps is completely free. In this way, one could easily imagine a dark social media SNapp in which users could engage in without ever worrying about their data being used without their consent to sway an election, to deter a political protest, or to bombard them with advertisements on subsequent sites they visit.
LOKI Token in the Mix(net)
This is not meant to be a cover-to-cover breakdown of everything the LOKI team has done right and wrong, or an assessment of their token economics and allocation, (all of which has been done in multiple sources included below). This is meant to identify how a project is creatively employing existing technology while developing still nascent tech to achieve outcomes that will positively impact not only the way we transact our money, but more importantly, the marketplace in which we transact our ideas. I am excited about what they are doing surely from a technical perspective, but also from a philosophical one that speaks to the best parts of me. Leave your comments below if you too are a LOKI fan, and perhaps even more so if you are not. As always, I am happy to discuss this, and other emerging projects and opportunities in The Birb Nest Discord channel linked in the publication, though at this rate, we may be moving to a SNapp near you in the not too distant future.
Sources:Net neutrality via blockchain: analyzing Loki Network’s onion routing mixnet
In this write-up, I aim to fundamentally analyse Loki Network ($LOKI), a crypto-project aiming to create a more private…hackernoon.com What Are SNApps?
We wanted to write an article that provides a clearer explanation of what Loki SNApps are, how they work, and how you…medium.com LOKINET
Loki’s Exploration into the Mixnet Spacemedium.com Loki’s Response to the Assistance and Access Bill 2018
As many of you may have been tracking, the Australian Parliament has been deliberating on a piece of legislation for…hackernoon.com My review on Loki Network
What is Loki?medium.com FAQ - Loki Docs
Fixed ring size with minimum mixin of 10, governance block reward of 5% which will fund community projects and…loki-project.github.io How the Assistance and Access bill is going to hurt every Australian.
Why the world will lose trust in Australian technology.hackernoon.comThe Silk Road Creator's Life Sentence Actually Boosted Dark Web Drug Sales
Two years ago this week, Ross Ulbricht was sentenced to life in prison without parole for running the Silk Road, an…www.wired.com