Transparency

Johannes Sedlmeir and Gilbert Fridgen

Chapter 54 in Elgar Encyclopedia of Cryptocurrencies, Blockchain and DLT, 2026, pp 262-268 from Edward Elgar Publishing

Abstract: This chapter presents the transparency inherent to blockchain networks as a two-sided sword. On the one hand, transparency enhances trust by allowing any participant in the blockchain network to verify transaction authorization and processing. On the other hand, the replication of data and computation by consensus participants precludes effective access control mechanisms. We discuss several harmful impacts of this excessive transparency, such as conflicts with the requirement for protecting sensitive personal and business data and opportunities for frontrunning. Lastly, we outline strategies to achieve selective transparency by using suitable privacy-enhancing technologies, such as zero-knowledge proofs.

Keywords: Auditability; Confidentiality; Cryptography; Data protection; Secure computation; Verifiability (search for similar items in EconPapers)
Date: 2026
ISBN: 9781035339952
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