CoinFog

CoinFog is an Algorand-based privacy tool that allows users to make anonymous transactions on the blockchain. It does this by implementing a "mixer" service.

Mixers are tools that can be used to obscure the origin and destination of funds. They do this by taking in a large number of transactions from different users and outputting a similar number of transactions to different addresses. This makes it difficult for someone to trace the origin or destination of a particular transaction.

Uses

CoinFog allows users to access decentralized applications (dApps) with greater privacy and security. Purpose of this platform is for:

1. Increased financial privacy: to obscure the flow of funds between different addresses, making it more difficult for others to track an individual's or business's financial activity from prying eyes.
2. Avoidance of censorship: to bypass censorship attempts by centralized entities.
3. Protection against surveillance: another layer of secrecy against surveillance by centralized agencies or other entities, helping to preserve privacy and autonomy.
4. Hiding Business Expenses: Businesses can keep their expenses private and protected, such as medical expenses and anonymous donations without fear of their information being leaked.

Features

In the case of Mixers, zero-knowledge proofs are used to ensure that the mixer service cannot link a user's input to their output. This is done by allowing users to prove that they own a certain amount of funds without revealing which specific funds they are using. The current version of CoinFog does not yet include the implementation of zk-proofs. However, the team is working on incorporating this feature into the platform. The implementation of zk-proofs will enhance the security and privacy of the transactions made on CoinFog.

CoinFog has the following features on frontend:

• user-friendly and visually appealing UI/UX design.
• visual cues that deposit and withdrawal transactions have been detached.
• allows users to connect to the frontend through various types of wallets.
• frontend deployed on Fleek (IPFS), which means that users can run their own instance and bypass censorship efforts. Also on Vercel for the OG's.

Motivation

https://www.reddit.com/r/AlgorandOfficial/comments/prs7b8/private_transactions_in_algorand/

Installation

Clone the repository and follow follow this steps:

$ git clone [email protected]:Adg0/CoinFog.git
$ cd CoinFog
$ mv .env.example .env
$ vim .env
// change variables
$ pip install -r requirements.txt

Compatibility

CoinFog is compatible with the following wallets:

• Pera
• Exodus
• DeFly
• AlgoSigner
• MyAlgoWallet
• WalletConnect

Tech Stack

CoinFog is built with the following technologies:

• PyTeal: PyTeal is used to implement smart contracts.

• Python AlgoSdk: Python AlgoSdk is used to interact with the Algorand network.

• NextJS: NextJS is used for the frontend framework.

• TailwindCss: Tailwind is used for styling the application.

• Fleek: Fleek is used for hosting the application.

Architecture

Depositor makes a deposit with app call to mixer contract. That is making a deposit of 5 Algos.

Withdrawal calls are made from a relay to preserve anonymity. The relay is built as delegated contract; that is a smart signature. A relay is used to break link to new account.

Safety is taken to protect relay delegation; that is

1. Rekey check
2. Fee check
3. Allows only application calls, specifically to mixer app
4. On-completion is restricted to NoOp; because malicious actors might attack the relay by calling clearState on-completion and drain the funds of relay address.

Depositing

Verify call sent is sent with 5 Algos, in atomic transction to pool.

Global state next is incremented

Hash(secretX, nullfier) is added to hash box

MerkleProof(next) is calculated

Global state MerkelProof is updated with MerkleProof(next) calculated value.

Withdrawing

Password is sent as argument, example: secretP, nullifier.

Search nullifer box that no entry for Hash(nullifierP) is available.

Search hash box that their exsists Hash(secretP)

Update nullifier box by adding entry Hash(nullifierP)

Send Atomic transaction with:

Txn.account[0] gets 100k microAlgo: that is the relay fee, anyone can create another relay to collect relay fees
Txn.account[1] gets 5 Algo - relayFee - mixerFee

Profit

Last part is taking profit from mixer contract. And the creator address can withdraw profits made, which is the mixerFee deducted when depositors withdraw their balance.

Support

For support, please open an issue on the repository.

Contribution

We welcome contributions to the CoinFog project. If you are interested in contributing, please open a pull request on the repository.

License

CoinFog is open-source software licensed under the MIT license.

⚠️ Please note that CoinFog is a proof of concept, not to be used in production environment.

ToDo

• Relay
• Relay test
• Mixer contract
• Mixer test
• Frontend wallet connect
• Documentation
• Presentation