Sweet Spot: Bitcoin Cash to Add CashShuffle Privacy Feature

Sweet Spot: Bitcoin Cash to Add CashShuffle Privacy Feature

TL;DR: CoinSpice reached out to the CashShuffle Development Team, asking about progress on the project. Financial privacy is a topic of hot interest in the cryptocurrency space. Some blockchains such as Bitcoin Core (BTC) are for the most part completely transparent and public. On the other end of the spectrum, coins like Monero are mostly dark and untraceable. Bitcoin Cash (BCH) now attempts to hit the sweet spot by adding the CashShuffle protocol to the wallet/application layer.

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Bitcoin Cash to Add CashShuffle Privacy Feature

Sweet Spot: Bitcoin Cash to Add CashShuffle Privacy Feature

CashShuffle is a protocol that enables sharing of inputs and outputs between users. For example, if Alice wants to send 1 BCH and Bob also wants to send 1 BCH, they can combine their transactions so that an observer does not know which transaction output came from Alice and which one corresponds to Bob.

The basic building block idea of combining inputs and outputs is known as CoinJoin and was first discovered by BTC developer Gregory Maxwell. From this foundation came the CoinShuffle protocol, which adds layered encryption so that if Alice, Bob, and Carol are combining their transaction inputs, not even Alice, Bob, or Carol knows exactly who’s money is going where. Finally, CashShuffle adds a client-server matching algorithm on top of this scheme to form a complete protocol that can be implemented by any wallet.

Sweet Spot: Bitcoin Cash to Add CashShuffle Privacy Feature

No Base Protocol Change

One nice thing about CashShuffle is that it does not require any modifications to the underlying Bitcoin Cash protocol. Essentially, it is still the original Bitcoin code and design. Shared inputs and sighash flags (to allow partial signing) have long been a part of the Bitcoin functionality.

CashShuffle builds on top of all this. By avoiding changes to the base layer, CashShuffle eliminates the risk of undesirable changes with unforeseen consequences.

The Right Amount of Privacy

CashShuffle is optional, so that if a user does not want to use it, they can simply send a traditional transaction as they’ve always done in the past.

Sweet Spot: Bitcoin Cash to Add CashShuffle Privacy Feature

However, for users that want a bit more privacy, CashShuffle does the job nicely since even a single round of a joined transaction introduces obfuscation, and makes tracking transactions from a single user more difficult.


One of the biggest benefits of CashShuffle is to make Bitcoin Cash more fungible. If everyone’s coins are constantly being shuffled and combined, then it becomes very difficult for an exchange or other company to “ban” or “blacklist” a coin. In other words, everyone’s bitcoins will start to become tainted with inputs from everyone else’s coins.

Another nice aspect of CashShuffle is that it plays nicely with other privacy tools and features coming to Bitcoin Cash, including atomic swaps.

Further Decentralization

Although initially implemented as a client server model (anyone can run a server using the open source software), developers are already making plans to fully decentralize the shuffling so that no special servers are required.

Electron Cash and the Security Audit

CashShuffle development has been in progress for over a year via a plugin for the popular Electron Cash wallet. But now, the Electron Cash developers are signaling that the functionality will be pulled into the mainline wallet. This will not only make things simple and easy for users, but also will provide a constant stream of liquidity. Users can simply leave the wallet running on their computer and the coins will shuffle in the background.

Sweet Spot: Bitcoin Cash to Add CashShuffle Privacy Feature

As a final step before releasing the Electron Cash version with integrated CashShuffle, the community is waiting on approval from Kudelski, a third party company who is auditing both the wallet and server code.

Bitcoin Cash could now have CashShuffle privacy by early March of 2019. The Bitcoin.com wallet also plans to add CashShuffle as soon as possible, which will further enrich and support the privacy features.

Special thanks to the CashShuffle Development Team for this write up.

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