/biz/ - Business & Finance

>>55515078
I don't know if this is detailed I can give my own take on why L1 smart contract support and privacy.
Having a "smart contract" presupposes some sort of custom intractable code being placed on-chain that is deterministic, since it must produce the same result for all nodes running the chain. Every node must be verify a chain of instructions being executed correctly. To whom, to what, and how much.
However, with smart contracts what code gets executed can vary by the user's desires. And since interactions with smart contracts are singular transactions, any cryptocurrency with L1 smart contracts must have clearly identifiable interactions with it. This does not fit Monero's privacy model as Monero strives for transaction uniformity. See picrel from the Monero Inflation Checker and it shows how Monero phased in and phased out transaction types (deterministic scripts in a sense). This guarantees that members in a ring signature have no information attached to them.
For example, let's suppose Monero added support for Solidity smart contracts by tomorrow. If a user interacts with a smart contract now, then that output (no longer matters that it's a one time output) will be visibly different from the rest. So when it gets included in 50 other transactions and 1 of which interacts with the smart contract again, then ChainAnalysis can take an educated guess. And smart contract users would have to begin managing their UTXOx, which is not the sign of a private system. And even if smart contract interactions are made somewhat uniform or obfuscated they present alternative "anonymity puddles" which represent their effective anonymity set. This would not only hurt smart contract users' privacy, but also the privacy of the rest of the transactions.