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Replying to Avatar Timechain

There is actually a very widespread misconceptions about privacy benefits Lightning. If you use custodial, you have no privacy (from your wallet). If you use noncustodial, the receiver has bad privacy. For the sender, you may have good privacy, but there may be an active surveiller if they are doing active routing surveillance.

It's definitely a good thing to have around. No need to keep money in e-cash form though, but it's there if you want to, let's say donate to something really sensitive, get some e-cash, send it to them, (through signal or Nostr DM,) they cash it. I guess that's the thing, you text message or nostr post or email someone a cashu note. There's no chainanalytics or off-chainanalytics (Lightning surveillance) that can be done on it.

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𝔽𝕒𝕥𝕙𝕖𝕣 ℕ𝕚𝕔𝕜 𝔹𝕝𝕒𝕙𝕒 2y ago

This is a helpful breakdown.

Where can I find more info about why the receiver in a self-custodial lightning transaction lacks privacy?

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Timechain 2y ago

Custodial lacks privacy for both sender and receiver, as the wallet sees everything. self-custodial mostly lacks privacy for the receiver.(you have to know where to send it)(But there's always a chance that the node routing your payment could be a secret spy node working for chainanalytics and figre out the sender too.)

This is a really good resource.

https://abytesjourney.com/lightning-privacy/

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