How does Cloak compare to Monero/Zcash/Dash/ETC?
The ENIGMA transaction system designed for CloakCoin utilizes off-blockchain mixing in order to 'cloak' transactions on the Cloak network. To facilitate this, nodes on the network collaborate with senders and provide their own inputs and outputs (funds in, funds back out) to an ENIGMA transaction in order to obfuscate the transaction. The resulting ENIGMA transaction has a number of inputs and multiple matching outputs, one of which belongs to the true recipient. As a reward for cloaking transactions, cloaking nodes are rewarded a share of the 1.8% ENIGMA fee, which is currently provided by the sender. In addition to this, CloakCoin also supports Proof-of-Stake in addition to ENIGMA rewards, so users get a standard PoS (proof-of-stake) reward when staking/minting their coins and also an ENIGMA reward whenever they help to "Cloak" an ENIGMA transaction.
As the ENIGMA system is 100% trustless (other nodes are never trusted with your funds), there is no need for Masternodes and any funded CloakCoin wallet can act as a Cloaker and earn rewards for cloaking ENIGMA sends from other uses. This system provides a high level of fungiability due to it not being possible to determine the true sender or recipient of an ENIGMA transaction. As the percentage of ENIGMA transactions vs. standard transactions on the CloakCoin network increases, fungiability approaches 100%. We are currently working towards all transactions on the CloakCoin network being ENIGMA transactions.
The ENIGMA system is fully decentralized and peer-to-peer. There are no secret/destroyed keys used to secure the system and no centralized servers required. This fully-decentralized approach ensures that there is no single point of failure and the decentralized network remains responsive and organic.
Due to Engima functioning 'off blockchain' for the transaction creation, there is no requirement for blockchain customizations, allowing ENIGMA to work with a standard 'bitcoin style' blockchain. This also has the added beneifit or allowing improvements to the ENIGMA system to be rolled out to users while still maining full backwards compatibility with nodes running old versions of the CloakCoin wallet software. As ENIGMA uses standard transactions, there is a reduced risk of technical exploits being used to attack users' privacy, which could be possible with some 'bleeding-edge' private transaction systems.
We feel that CloakCoin is still something of a sleeping giant, which could provide significant gains for investors as the project gains more traction with the crypto-community and users wishing to make fast, secure, private and untraceable transactions.
Last update on 23. February 2017 by CloakTeam.