Paul Puey, co-founder of Edge (self-custody wallet and exchange), interviewed Charlie Lee to discuss recent Litecoin development and improving Litecoin integration within Edge.
Edge recently added Litecoin as a default wallet within the app — joining Bitcoin, Ethereum, Bitcoin Cash, and Dash. Charlie revealed they are working with Edge in the hope that Edge will be among the first to implement mobile wallet MWEB support. This would allow you to hold your Litecoin privately and securely without running Litecoin Core.
They discussed the trade-off of scalability vs privacy when comparing Litecoin to Monero and Zcash. As an example, with Monero every output is never purged and must therefore be stored. With MWEB, the privacy guarantees are not as complete as with Monero or Zcash, but with much better scalability due to a concept referred to as cut-through.
MWEB fully protects the amounts being sent between users within MWEB. However, the routing of transactions (transaction graph) is not fully hidden from a sophisticated observer in its current form. Cut-through refers to the majority of transaction data being eliminated over time without compromising security within MWEB. Simplifying, MWEB operates as a coin-joined block of outputs without the history of those outputs being permanently recorded. This is consistent with the current banking experience, in which the receiver can't tell how much money you have in your bank account or view who you have transacted with in the past.
The challenge with mobile wallet privacy is typically relying on a third party's server, which requires trusting that server with a view key, which could compromise which transactions are yours, but does not reveal where they are coming from or the amounts being transacted. Charlie says he expects different light client implementations that can provide varying levels absolute privacy versus user experience being improved by a view key. On the roadmap, Charlie indicated the Litecoin Foundation is looking to build out the light client infrastructure for LiteWallet first, then based on that experience start building the libraries and reference implementations for those building their own light client wallets to follow.
For sending to MWEB addresses from a light client wallet, Charlie indicated that the sender wallet would create the peg-in, with tooling to be developed to help implement sending to MWEB addresses.
Other miscellaneous topics include:
Charlie mentions that although he is unsure the extent of scaling, the increased transaction capacity should be significant.
Charlie's opinion that he would be surprised if Bitcoin implemented MWEB due to Bitcoin's more conservative nature.
A comparison of pegging into and out of Litecoin as having the same general privacy trade-off as performing an atomic swap into and back out of Monero from Litecoin, except that you bypass the volatility of the exchange rate between two separate coins.
- Vitamin Ł (@LtcBtc)
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