The concept of asymmetric privacy applies to digital payment systems. The system offers the payer (usually the user) a high degree of privacy, whereas the payee (usually a company) has less privacy.
There is a unique set of rules that apply to digital systems that handle money transactions. Usually, we should not expect any level of privacy if we choose to pay digitally. It doesn’t matter if we look at credit cards, bank transfers, PayPal or the Brazilian PIX payment DPI. The complete transaction history is usually visible to the payment provider and within the rules of anti-money laundering and anti-terror finance legislation, the government also has access to this data.
Analogue cash offers a great level of privacy, but has physical limitations and is currently pushed away by the advent of digital payment. Asymmetric privacy is an interesting concept that offers a new balance to this debate.
Unlike unregulated cryptocurrencies, it satisfies the regulatory requirements for payment systems. It does so by offering complete transparency regarding the recipient of a transaction. But through a very elaborate use of cryptography, it still protects the privacy of the person that has sent the money.
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Further Reading
🔗 Central bank digital currency with asymmetric privacy
🔗 A Theory Model of Digital Currency with Asymmetric Privacy
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