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Arkham Intelligence data reveals that Vitalik Buterin, the Ethereum co-founder, transferred 80 ETH to the privacy-focused Railgun today. At today’s price, Buterin’s transfer is valued at roughly $300,000.
According to on-chain data, this transfer is a significant example of Buterin’s ongoing use of Railgun over the past six months.
Buterin’s Continued Support for Privacy Tools Raises Questions and Debates
Buterin’s regular transfers to Railgun highlight his view that privacy is a fundamental right. Responding to the attention his actions often receive, Buterin stated that “privacy is normal.” He stressed that although privacy-focused protocols can be misused, tools like Railgun are built to protect legitimate users.
“Railgun uses the privacy pools protocol which makes it much harder for bad actors to join the pool without compromising users’ privacy,” he said.
Read more: What is Railgun? A Guide to the EVM Privacy Protocol
In a recent BeInCrypto interview, Alan Scott, a researcher at Railgun, explained that Railgun uses zero-knowledge proofs (zk-SNARKs). This aims to ensure user privacy in DeFi applications. Railgun’s features include Private Proofs of Innocence, allowing users to show they have not interacted with malicious actors on-chain.
This technology ensures users do not share a system with nefarious addresses. Additionally, Railgun includes “auditability” features, such as a view-only private key, enabling users to reveal transaction graphs to third parties.
Despite its robust technologies, Railgun has allegedly been used by the Lazarus Group, a hacker group reportedly linked to the North Korean government. Eliptic’s January 2023 report indicates that the Lazarus Group switched to Railgun. They did so after the US Treasury sanctioned crypto mixer Tornado Cash, their previous tool for money laundering.
The group used Tornado Cash to obscure their June 2022 theft of over $100 million from the Harmony Horizon Bridge. However, the Federal Bureau of Investigation (FBI) confirmed that the Lazarus Group used Railgun to launder over $60 million of Ethereum from that theft.
Read more: Top 7 Tornado Cash Alternatives in 2024
Vitalik’s endorsement and the Lazarus Group’s exploitation of Railgun highlight the ongoing conflict between individual privacy and preventing criminal activity within the crypto industry. This adds an important data point to the broader discussion about blockchain regulation, anonymity protocols, and their risks to the financial system.