A Traceability Analysis of Monero’s Blockchain

Privacy and anonymity are important desiderata in the use of cryptocurrencies.
Monero—a privacy centric cryptocurrency has rapidly gained popularity
due to its unlinkability and untraceablity guarantees. It has a market capitalization
of USD 290M. In this work, we quantify the efficacy of three attacks
on Monero’s untraceability guarantee, which promises to make it hard to trace
the origin of a received fund, by analyzing its blockchain data. To this end, we
develop three attack routines and evaluate them on the Monero blockchain. Our
results show that in 88% of cases, the origin of the funds can be easily determined
with certainty. Moreover, we have compelling evidence that two of the attack routines
also extend to Monero RingCTs—the second generation Monero that even
hides the transaction amount. We further observe that over 98% of the results
can in fact be obtained by a simple temporal analysis. In light of our findings,
we discuss mitigations to strengthen Monero against these attacks.We shared our
findings with theMonero development team and the general community. This has
resulted into several discussions and proposals for fixes.