Moneros Decentralized P2P Exchanges: Functionality, Adoption, and Privacy Risks
arxiv.org
Privacy-focused cryptocurrencies like Monero remain popular, despite increasing regulatory scrutiny that has led to their delisting from major centralized exchanges. The latter also explains the recent popularity of decentralized exchanges (DEXs) with no centralized ownership structures. These platforms typically leverage peer-to-peer (P2P) networks, promising secure and anonymous asset trading. However, questions of liability remain, and the academic literature lacks comprehensive insights into the functionality, trading activity, and privacy claims of these P2P platforms. In this paper, we provide an early systematization of the current landscape of decentralized peer-to-peer exchanges within the Monero ecosystem. We examine several recently developed DEX platforms, analyzing their popularity, functionality, architectural choices, and potential weaknesses. We further identify and report on a privacy vulnerability in the recently popularized Haveno exchange, demonstrating that certain Haveno trades could be detected, allowing transactions to be linked across the Monero and Bitcoin blockchains. We hope that our findings can nourish the discussion in the research community about more secure designs, and provide insights for regulators.

New research paper about HavenoDex shows trades between Monero and Bitcoin are traceable.

Abstract:

…We further identify and report on a privacy vulnerability in the recently popularized Haveno exchange, demonstrating that certain Haveno trades could be detected, allowing transactions to be linked across the Monero and Bitcoin blockchains.

  • rideEnglish
    4·
    2 days ago

    TL;DR

    Send your Monero from RetoSwap to another wallet from where you use it. Do not use it within RetoSwap for payments. Is that what it boils down to? Then I would like to remind you that in practice it makes sense to use two wallets. One for receiving and one for sending. The one for sending will be replenished by the one for receiving. https://monero.town/post/5701064

    • HardenedSteelOPEnglish
      2·
      1 day ago

      There’s no problem with Haveno or Retoswap’s wallet. The research shows about trades between Bitcoin and Monero.

      Fiat trades are fine.

      • rideEnglish
        2·
        1 day ago

        So: stick with Monero. It is a common misconception that swapping back and forth makes sense. If you want to store value, you should store it in the more secure Monero and, if you need to use BTC, exchange the required amount into BTC at the time of payment.

        When exchanging BTC for XMR, it is a necessary evil that you have to use the BTC. But once you have exchanged them for XMR, you are on the safe side.

    • adminMA
      2·
      1 day ago

      No, the transaction tracing relies on the transparent bitcoin chain. It does not work for the off-chain payment methods and especially not for something super private like cash by mail.

        • adminMA
          2·
          1 day ago

          It’s not really but the paper suggested some improvements that would make the transactions waaaay harder to link to a trade. Definitely a net-positive for privacy.