Fungibility

Why is Fungibility important?

With physical cash, it's not necessary to be concerned with which individual bills you have, as they are interchangeable. This is not the case with Bitcoin, as

Fungibility is the property of a set of goods or assets that ensures the individual units of that set are of equal value and are interchangeable. It is what differentiates the earliest forms of currency from their preceding systems of barter. Without confidence in the fungibility of money, that money rapidly loses its utility. As you will see, the fungibility of previous crypto-currencies is now in danger, whereas Epic Cash’s privacy architecture ensures it is impervious to the same threats.

Most cryptocurrencies similar to Bitcoin, by the nature of the transparent blockchains on which they exist, can be verifiably traced through every wallet in which they were kept. Private third parties and governments alike monitor the Bitcoin blockchain with increasingly sophisticated means to quickly identify coins used in a previous activity. This naturally leads to concerns that tainted coins might someday be banned from transactions, leaving their subsequent good-faith holders at a loss.

 

On March 19, 2018, the U.S. Office of Foreign Asset Control (OFAC)announced it was considering including digital currency addresses to the list of Specially Designated Nationals (SDNs),which are entities with whom U.S. persons or businesses are forbidden to transact. Even more troubling, OFAC has not ruled out the inclusion of addresses currently holding tainted coins on to the SDN list, which would effectively place innocent owners of tainted cryptocurrency on a criminal blacklist due to the affiliation of the tainted coins owned. This has led New York University legal professor, Andrew Hinkes, to quip, “kiss fungibility goodbye,” and that the public should expect “a premium on freshly minted coins, or traced “clean” coins...”

 

With these developments in mind, it’s not difficult to imagine an upheaval in the crypto market and the suffering, or even extinction, of many well-established cryptocurrencies. However, Epic Cash is one of the few cryptocurrencies that avoids this problem entirely due to the strong privacy features previously described in this paper. By removing the link between identity and ownership, and the relationship between transacting parties, Epic Cash can never be affiliated to a person or an activity. As such, the value of Epic Cash remains independent of its users and provides security in savings that cannot be easily manipulated by malefactors in criminal, financial, or political arenas.

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© 2019 EPIC Blockchain Foundation. Made with Love in Wyoming, United States.