Mimblewimble is a word probably recognizable only to fans of the Harry Potter series, being a curse that binds the victim’s tongue. It is also however a blockchain that, some argue, does Bitcoin better than Bitcoin itself. So, what is it about this oddly-named protocol that has such game-changing capabilities?
Next Level Encryption
Mimblewimble is a blockchain that offers important improvements and differences over Bitcoin, foremost in the fields of security and privacy. Critical information such as the addresses of the parties involved and the amount of tokens being sent are encrypted through a series of complex mathematical equations, rather than being broadcast in their native form on the blockchain.
These are known as Confidential Transactions, and they rely on both parties resolving their own equations by providing the keys that solve them. For example, let’s say some transaction details are encrypted by the following (rather simplistic) formula:
11 x 57 x ?? x 17 x ?? = 20,348,031
Even if a third party did somehow manage to get their hands on this equation at the same time as you, which is extremely unlikely, they have to not only balance the equation but they have to find two exact numbers and input them in the right order. Compared to you, who has them in advance. And, don’t forget that encryption engines don’t use straightforward numbers like the ones above – they use hideously complicated elliptical curve points.
So, you put in 23 and 83 (go ahead, check), your friend puts in his numbers, and the transaction is conducted, with all critical elements being completely hidden. When the transaction hits the blockchain, as long as the encrypted ‘plus’ figure (the amount of tokens headed for the recipient’s address) is equal to zero when the minus figure (the amount of tokens being sent from the sender’s address) is subtracted, the blockchain knows that the two ends of this particular transaction match up and it processes it.
Solving Bitcoin’s Privacy Problem?
Satoshi Nakamoto was realistic about Bitcoin’s privacy in the Bitcoin whitepaper, acknowledging that the addresses of the transacting parties and the exact funds being exchanges would always be made public.
Mimblewimble arguably solves this problem, with the mechanisms expected to get more refined and faster as time and use evolves. For now, two projects, Grin and BEAM, are making use of the Mimblewimble blockchain, and you can expect to hear much more about it as 2019 rolls on.
