December 14, 2018. MasterCard is filling a new patent that can make blockchain transactions anonymous. It may sound like privacy coins in circulation such as Monero but the patent is leaning more on “coin mixing”.
A new patent is on its way from one of the leading global payments and technology company, MasterCard. The patent aims to make blockchain transactions anonymous but not like how privacy coins do it as it is leaning more on coin mixing.
Coin mixing is a process where several transactions are mixed like in a washing machine to obscure the original source of funds. By using this process, blockchain transactions are completely anonymous as the “transactions” are already mixed with other transactions.
Coin Mixing Analogy:
If you purchase something from a convenience store, your P100 will get mixed to the cashier’s cash register. Your change will also come from the same cash register that already has different “owners” of the fiat. Nobody really knows if the last transaction of the fiat got engaged in a criminal activity or not.
“In some embodiments, the processing server may utilize multiple blockchain wallets to further increase anonymity. In such embodiments, the processing server may possess a plurality of different cryptographic key pairs.
In some embodiments, the processing server may also anonymize transactions via the obscuring of transfer amounts. In such embodiments, the processing server may break up the second transaction (e.g., the transfer to the recipient’s blockchain wallet) into multiple transactions, where the total amounts from each of the transactions equals the specific amount being transferred to the recipient by the sender. In some cases, each of the transactions may transfer an equal amount of currency (e.g., a total transfer of 36 units of currency may be accomplished in three transactions of 12 units of currency).” – Mastercard
As of press time, it is not yet clear what MasterCard will do to this patent as a regulated financial company. It is sure that the company still needs regulatory approval before launching any product or business models. In addition, it should also respect KYC guidelines and AML.
It is previously reported here on BitPinas that MasterCard is making cryptocurrency transactions faster with a new U.S. patent. Its solution to reduce transaction time is to offer a new type of user account that is able to transact in cryptos using the same systems for fiat.