Confidential Transaction
A privacy technique that hides a transaction's amount from public view while still letting the network verify it's mathematically valid.
A confidential transaction hides the actual amount being transferred from public view, while still using cryptographic techniques (commonly a form of commitment scheme, see Kaavon's "Commitment Scheme" glossary definition) to let the network verify the transaction is mathematically valid — specifically, that no new funds were created out of thin air.
This specifically addresses the amount-hiding half of transaction privacy, distinct from hiding the sender or receiver's identity — Monero's RingCT mechanism (see Kaavon's "Privacy Coins Explained" guide) is one well-known implementation of confidential transaction amounts specifically.
Examples
- A confidential transaction's amount is hidden from public view, while the network can still mathematically confirm no funds were created from nothing.
- Monero's RingCT mechanism is a well-known implementation of confidential transaction amounts, combined with separate techniques for hiding sender and receiver.