What is Bitcoin Private?
Last Updated: 1st November 2018
Bitcoin Private (BTCP) is a fork merger of the two more well-known cryptocurrencies, Bitcoin and Zclassic. The purpose of Bitcoin Private is to facilitate for the peer-to-peer movement of digital currency, just as Bitcoin does, whilst also allowing for an increased level of transactional privacy through the implementation of technologies inherent to the Zclassic protocol.
This form of forking is not the same as a hard & soft fork, but instead, involves the combination of the Unspent Transaction Output (UTXO) sets of two different cryptocurrencies at a given point in time. In this case, and according to its whitepaper, Bitcoin Private took a snapshot of the state of all Bitcoin and Zclassic addresses at 5 PM UTC on Feburary 28th 2018. The retrieved addresses and combined UTXO sets were then used to form a new blockchain, i.e. the Bitcoin Private blockchain. The merger took place on block number: 511346 for Bitcoin, and 272911 for Zclassic. In addition, this merger purportedly resulted in the reduction of the blockchain size from 157 GB to 10 GB.
Due to the merging of the UTXO sets of Bitcoin and Zclassic, at the point of the fork merger, approximately 20.4 million out of 21 million BTCP coins will already exist, and be in circulation. This therefore leaves approximately 600,000 – 700,000 mineable BTCP coins. All Zclassic transparent and shielded addresses, as well as Bitcoin segwit and normal addresses, will receive BTCP in a ratio of 1:1 for every Zclassic and Bitcoin owned.
A starting block reward of 1.5625 BTCP has been selected, with halving occurring every 210,000 blocks (roughly once every year). The Bitcoin Private blockchain also supports replay attack protection.
A summary of the key technical differences between Bitcoin Private and other Bitcoin implementations can be found below:
Proof-of-Work – Bitcoin Private supports proof-of-work mining algorithm, Equihash, in an attempt to prevent the decentralization of mining that can occur due to ASICs.
Privacy – The Bitcoin Private blockchain, similar to Zclassic, supports two different types of transactions: transparent and shielded transactions. Transparent transactions function in exactly the same way as regular Bitcoin transactions, with all the information such as: the sender, the recipient and the amount, being publicly viewable on the blockchain. Conversely, with shielded transactions, or JointSplit transactions, all of that information is encrypted, and thus, cannot be deciphered when on the blockchain. However, through the use of zk-SNARKs, the validity of shielded transactions can still be checked by ensuring the total input of a shielded transaction, is equal to the total output.
Voluntary Miner Contribution Program & Treasury Fund Governance
The Bitcoin Private implementation also supports a contribution program in which miners can donate a total of 50,000 ZCL in the form of hashing power, in return for early mining access of up to 62,500 BTCP.
Such a program is meant to aid further development of the Bitcoin Private eco-system, with the proceeds received being distributed in the following way:
- Exchange listing – 50%
- Development – 25%
- Marketing – 15%
- General/administrative – 10%
A treasury governance council consisting of: three members of the development team and two members from the mining community has also been established. Such a council, with each member representing their respective communities, has the sole function of overseeing how funds in the treasury funds are spent.
More information on Bitcoin Private can be found in its whitepaper.