Blockchain’s identity crisis: self-sovereign identity vs. privacy coins vs. surveillance

One of the defining characteristics of blockchain technology is transparency. In public blockchains, such as Bitcoin and Ethereum, every transaction is visible to anyone with access to the ledger. This design, whilst ideal for validating trust in a decentralised environment, creates challenges when it comes to privacy. Even though pseudonymous addresses represent users, advances in blockchain analytics have made it increasingly easy to link these addresses to real-world identities through behaviour patterns, IP tracking and off-chain data. Unsurprisinlgy, this transparency is seen as a virtue in combating fraud, enabling auditability and supporting accountability, however, when financial transactions, medical data and identity credentials are exposed (even pseudonymously) privacy becomes an illusion. The immutability of blockchain only heightens this risk since, once data is added, it cannot be altered or erased. Hence, the fundamental question becomes: how can individuals retain cont…