Replying to Avatar Cyph3rp9nk

Idea of coinjoin implementation on Liquid.

Through the pegins and pegouts in the Liquid network we could follow the trace of a user, although it is true and it must be taken into account that the bitcoins that are delivered in the pegout are not linked to the bitcoins sent in the pegin. In principle, if I am not mistaken, a sort of FIFO queue is used and blockstream also performs consolidation processes of the addresses containing the bitcoins in the pegin.

This adds privacy in the Bitcoin chain, but we could still track through liquid even with confidential transactions.

As I mentioned before, with sideswap we avoid this because when you do a pegout you are really doing a swap, for small amounts they use their cache hotwallet and the actual pegout is done a posteriori thus unlinking it from the delivered coins and breaking the traceability, but desirably this would work for all amounts and not depend on a third party.

We could adapt joinstr to work on Liquid and confidential transactions, with this we would achieve that after a pegin + a coinjoin with joinstr it would be impossible to follow the trace and given the above mentioned peculiarities in which there is no relationship between the bitcoin of the pegin and the pegout + coinjoin + confidential transactions, with a single round of coinjoin would be more than enough and much more economical than current solutions.

nostr:npub1v6qjdzkwgaydgxjvlnq7vsqxlwf4h0p4j7pt8ktprajd28r82tvs54nzyr You see the crazy idea? maybe I'll get to work on it.

Yes, this is exactly what I was thinking! Can't believe nobody is on this yet. Liquid is so powerful, yet largely ignored.

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