K-Anonymous Payments in Pseudonymous Blockchains

Linkability of transactions is a serious threat to cryptocurrency payment anonymity. In fact, in pseudonymous blockchains, payments are not considered to be effectively anonymous. Blockchains such as Monero or Zcash aim to prevent transaction linkability by using complex cryptographic mechanisms. Therefore, they are considered anonymous blockchains. However, the recent literature has proven that, in a threat model in which the adversary is able to monitor network traffic, transaction linkability can be achieved even in anonymous blockchains. In this paper, we propose a solution that allows k-anonymous payments also in the above threat model, thus overcoming the privacy problem that plagues blockchains. The solution is inspired by overlay-routing approaches used in the context of anonymous communication networks when the global network adversary is allowed.