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Crypto pioneer David Chaum announces digital currency Praxxis

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Yesterday the blockchain project Praxxis led by ‘crypto Godfather’ David Chaum was announced. Praxxis is a digital currency and blockchain which uses multiple new approaches for faster transactions, scalability, security, and privacy right down to the metadata. It was developed in secret by Chaum’s team at WBM Corp.

In the 1990s dotcom boom 64-year old Chaum’s company, DigiCash developed the first digital currency e-Cash which was available from banks such as Credit Suisse and Deutsche Bank.

A key issue with blockchains such as Bitcoin and Ethereum is you have to wait some time to ensure that the transaction is final and won’t be reversed. In contrast, it is claimed that Praxxis is capable “of finalizing payments at the scale and speed required by a global transaction system. ”

The Praxxis platform is also capable of anonymous payments, or it can provide “identified” check-like wallet transactions.

How Praxxis works

What sets Praxxis apart is its consensus protocol. Currently, the commonly used methods for ensuring the integrity of a blockchain are the energy-hungry Proof of Work (PoW) and the newer Proof of Stake (PoS). Chaum’s platform splits up the work of reaching consensus between a few nodes.

The ‘team’ of nodes is chosen randomly. This avoids the risk of adversaries gaining control since they can’t know which nodes will end up deciding whether blocks are added to the chain. Along with adding security, the team of nodes do most of the computation before the transaction gets to them. Once it does, it can be processed much faster than on traditional blockchains.

What about the scalability angle? In an interview with Blockchain News, Chaum explained that just eight nodes can make up a team. As the network grows, the protocol can use additional teams without a significant slowdown. The result is a blockchain scalable enough for a global transaction platform, as the announcement claims.

Privacy

The ideas behind Praxxis are based on Chaum’s work in cryptography and digital currency spanning forty years. His previous project, and ‘sister platform’ to Praxxis, is privacy platform Elixxir. One of the aims of the new blockchain is to support and complement Elixxir.

“The world also needs the Elixxir communication technology, since it is the only known practical way to shred the metadata that is inevitably created as we live our digital lives,” explained Chaum. By metadata, Chaum is referring to the sort of data that Facebook gleans about users. Or the trail left by Bitcoin that makes transactions very traceable.

How Elixxir works

The Elixxir project aimed to give messages and transactions complete privacy. It’s relatively easy to shield message contents. But it’s far harder to hide the identities of the sender and recipient, and the message’s time or location.

For example, when a digital token is traded on a blockchain, it’s not anonymous because everyone on the network can see the public addresses and the amount transferred. While the public address has no personal information, it’s possible to link the spending habits of that address to a person.

Elixxir emerged in September of last year to tackle this privacy issue as a combined messaging and payments platform. It also uses Chaum’s idea of a team of nodes, here they scramble up messages sent by multiple users on the platform in batches. This keeps the metadata of individual messages private and means that messages are indistinguishable from transactions.

Praxxis utilizes Elixxir to enable private transactions on its blockchain. Exchanging the digital currency results in data which is stored on the blockchain but can’t be linked to anyone. Essentially Elixxir is a ‘mixing network’, an idea that Chaum came up with during the 1980s.

Who is David Chaum?

David Chaum is credited with creating the first digital cash, known as e-Cash. While he also came up with the idea in the 1980s, it came to life during the dotcom boom of the late nineties. He had recently proposed a system which was very close to a blockchain – he only missed the decentralized part. This meant that e-Cash, now thought of as a precursor to modern digital currencies, had to be managed by a centralized body like a bank. So, it didn’t take off.

When blockchain emerged and completed the puzzle Chaum couldn’t quite finish, he was surprisingly quiet. It turns out he had been working out of the public eye on data privacy and the pre-computation angle of his nodes team concept.

All that work has finally emerged in the form of Elixxir and Praxxis, which he hopes will be a realization of truly peer-to-peer electronic cash.

Combining messaging and blockchain-based payments itself is not a new idea, Telegram, for instance, is big competition, plus Facebook has now joined the fray with Libra.

Praxxis is pushing its new approaches to blockchain. Along with the above, there are more methods: hash-based ownership, a familiar denomination of coins, and “fundamentally different” cryptography which is supposedly resistant to the quantum attacks of the future. Currently, it is unclear what kind of cryptography Praxxis will use. But a technical whitepaper is slated for release this fall.