Trezor wallet enables Bitcoin privacy feature with CoinJoin
Cryptocurrency hardware wallet firm Trezor is expanding the privacy of Bitcoin (BTC) transactions through collaboration with the privacy-focused Wasabi Wallet.
Trezor has rolled out the privacy-enabling CoinJoin feature on its hardware wallets, allowing users to enhance the privacy and security of Bitcoin transactions.
In the announcement on April 19, Trezor noted that the new function is immediately live on the company’s Trezor Model T wallet. The company plans to enable the CoinJoin option for its first hardware wallet, the Model One, in the near future.
CoinJoin is a process used to anonymize Bitcoin transactions that enables users to send their BTC as part of a large collaborative transfer and obfuscate transaction history. The method was introduced by former Bitcoin core developer Gregory Maxwell in August 2013, providing an option to send BTC transactions more privately.
Trezor’s new collaboration with Wasabi enables the CoinJoin option on its wallets and allows users to hide their transactions and balances while purchasing, donating and making other transactions with Bitcoin.
In order to enable CoinJoin, users need to open a new CoinJoin account on the main Trezor menu. The selection of the new CoinJoin feature is available alongside other account types, including Segregated Witness (SegWit) and Bitcoin Taproot accounts.
To enable maximum privacy, the CoinJoin feature on Trezor also prompts users to allow the anonymous communication protocol, Tor.
“Coinjoin in Trezor is optional, and users must first send their coins to a specific CoinJoin account if they wish to use this function. If users choose not to use CoinJoin, nothing changes for them,” Trezor’s Bitcoin analyst Josef Tetek told Cointelegraph.
As Coinjoin enables more privacy, coinjoined transactions are somewhat more costly, as they require users to pay a coordinator fee, Tetek said, noting:
“When entering a CoinJoin, users also pay a 0.3% coordinator fee and the mining fee. Remixes — further CoinJoin rounds — have no coordinator fee. There is no additional fee when spending coinjoined outputs.”
Unlike the coordinator fee, mining fees are charged with any other Bitcoin transactions. As such, users must pay a mining fee for each round for CoinJoin.
Apart from fees, the CoinJoin function is also associated with longer transaction times. Setting up a conjoin account discovery alone may take significantly longer than regular account discovery due to downloading whole blocks and using a slower connection on Tor.
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“The CoinJoin process itself can take up to several hours. Afterward, the outputs can be spent in the same fashion as any other Bitcoin outputs,” Tetek stated.
Trezor CEO Matěj Žák emphasized that Trezor values privacy as the most important asset of individuals. “Consequently, we’re delighted that we’ve found a way for our community to keep their Bitcoin history private,” he noted. According to the firm, Trezor is the first hardware wallet to implement CoinJoin, following in the footsteps of software wallets like Wasabi.
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