Watchman Privacy – Episode #175
Seth for Privacy: Keeping Monero Honest
Date: April 28, 2025
Host: Gabriel Custodiet
Guests: Seth for Privacy (Cake Wallet), Urban
Overview
This episode of Watchman Privacy dives deep into Monero's ongoing quest for honest privacy, its technical and community challenges, and the broader privacy crypto ecosystem. Gabriel Custodiet is joined by Seth for Privacy, a prominent Monero advocate and VP at Cake Wallet, and Urban, a consultant and privacy advisor. Rather than an introductory guide, this discussion focuses on recent Monero developments, wallet landscape, regulatory pressures, and realistic self-critique to ensure Monero remains not just popular, but truly effective in the face of adversarial scrutiny.
Key Discussion Points & Insights
1. Seth for Privacy’s Role at Cake Wallet
[02:01–05:44]
- Seth has transitioned from Foundation Devices, a Bitcoin hardware wallet company, to Cake Wallet, aligning more closely with his belief in Monero’s privacy mission.
- Cake Wallet focuses on making privacy and payments easy with Monero through technical enhancements, most notably:
- Background Sync (currently Android-only): Enables continuous wallet syncing in the background, significantly improving user experience—no more “waiting for wallet to sync after months of inactivity.”
- Expanded background sync features: syncing all wallets (except Decred), controlling sync on WiFi/charging/idle, better privacy with local view key usage.
- Other Upgrades: Ledger cold storage support, BIP39 seed compatibility for deterministic wallet creation with Monero.
- "We're really just trying to make privacy easy, make it where you don't have to change your entire life to gain privacy in some measure when using cryptocurrency. And that's a lot of the goal."
— Seth for Privacy [04:59]
2. Monero Developments: Full Chain Membership Proofs & Background Sync
[06:13–12:09]
- Full Chain Membership Proofs (FCMP):
- Dramatically enhances sender privacy: moves from “I’m one of these 16 inputs” (ring signatures) to “I’m one of every output ever created” (~100 million), making chain analysis exponentially harder.
- Design finalized, implementation nearly ready for testing—anticipated hard fork.
- Background Sync using View Keys:
- Technical advance allows safe syncing without exposing private spend keys, originally a security risk.
- Enables “magic” user experience: wallets always up to date, making merchant payments seamless even after months of inactivity.
Memorable quote:
“Background sync gives you a very similar experience to a Bitcoin wallet or something that's a little more straightforward because of the lack of privacy. But you're not sacrificing anything… You're doing it all locally, but you're doing it in the background. And it's, it's, it's pretty magical.”
— Seth for Privacy [11:23]
3. Regulatory Pressure and Exchange Delistings
[12:09–15:41]
- 2024–2025 saw a wave of Monero delistings from centralized exchanges due to:
- Indirect regulatory (banking) pressure—Operation Chokepoint–style tactics: “If you deal with Monero at all, we'll cut you off.”
- Gemini and Coinbase never listed Monero, Kraken and DFX (Switzerland) among few notable exceptions.
- Result: Most Monero trading is now via decentralized methods or the few remaining principled exchanges.
Memorable quote:
“Pretty much no centralized exchange lists Monero. ...When you look at something like Operation Chokepoint 2.0...it seems like Monero was really kind of the test bed for that.”
— Seth for Privacy [13:32]
4. Monero Wallet Landscape: State of the Ecosystem
[15:41–22:21]
- Supporting Monero wallets is technically challenging:
- Monero wallet SDKs, libraries, and caching are more complex/messy than Bitcoin’s (e.g., Bitcoin Dev Kit).
- Mobile: Cake Wallet, Monerujo (Android-only), and Stack Wallet are main options. Edge Wallet has privacy drawbacks (view key sent to server).
- Desktop: Feather Wallet and the Monero GUI wallet are the only credible options, with Feather built by a “fantastic dev” and widely preferred.
- Exodus dropping support August 2025—the business cost exceeds the user base benefits.
- Cake Wallet acknowledges desktop wallet needs a major overhaul in 2025.
Memorable quote:
“I think the area that is in most need of help, like you mentioned, is desktop… there's some people who really like to use desktop… it’s definitely a key thing there.”
— Seth for Privacy [18:08]
5. Why Don’t More Privacy Influencers Promote Monero?
[22:21–25:59]
- Two main theories:
- Financial Incentives: Zcash dev fund has historically paid influencers, including high-profile privacy advocates (e.g., Snowden), to promote Zcash, while Monero has no such funds or centralized budget.
- General Crypto Skepticism: Many privacy/security experts are wary due to the scale of scams in crypto (“just too dangerous”).
- “There is no marketing budget in Monero. … Whereas zcash has been able to put a lot of money into getting these influencers talking about it.”
— Seth for Privacy [23:17]
6. Challenging Monero’s Limits: Critique and Technical Questions
[25:59–38:18]
- The panel pivots to self-criticism, rejecting “cheerleading” and emphasizing areas for improvement:
- Issues with Monero wallet sync: Due to Monero’s monolithic cache file design, wallet resyncs can revert to much earlier block heights after crashes—a technical quirk that background sync may alleviate but doesn't fully solve.
- Full Chain Membership Proofs as “Silver Bullet”: Skepticism about overreliance—hard forks, ring size increases, and churning all come with downsides (increased complexity, UX costs, or privacy risks if done wrong).
- Churning’s actual effectiveness is unclear and may harm privacy if not properly understood or implemented.
Memorable quote:
“For most people, sane defaults are far better from a privacy perspective than going to more extreme paths in the search of like perfect privacy instead of good enough privacy.”
— Seth for Privacy [36:00]
7. De-anonymization Risks and Chain Surveillance
[38:18–45:04]
- Response to recent viral videos from chain surveillance companies claiming to “trace” Monero:
- Takeaway: Monero isn’t perfect, but even advanced, well-funded surveillance operations could only exploit specific, non-default behaviors (malicious remote nodes exploiting DNS issues)—not general weaknesses.
- “It was a good reminder that the holistic privacy of Monero is extremely effective and protects against even a lot of these very targeted cases. But it is weak to very specific things.”
— Seth for Privacy [41:24] - Greatest user protection comes from controlling your own node or using trusted ones.
8. Spam Attacks and Monero’s Long-term Scalability
[45:04–51:06]
- Spam Attacks: Monero is vulnerable to denial-of-service (DoS) attacks, especially since every output is presumed unspent and included in the anonymity set. Spam attacks can bloat the chain, raising costs for users and node operators.
- Fee Model & Dynamic Block Size: Raising fees to deter spam can harm usability; leaving them low could incentivize attacks, especially by large adversaries (nation states, seizure/confiscation).
- Comparison with Bitcoin: Monero’s dynamic blocks make it more susceptible to spam than Bitcoin’s hard cap on block size, but both face scaling threats from adversaries with deep pockets.
Quote:
“A spam attack from a really focused adversary or one with deep pockets, like a nation state, is a threat to essentially every blockchain. That's one of the core issues...”
— Seth for Privacy [46:43]
Notable Quotes (with Timestamps)
-
"Monero is the reason why I care about personal privacy at all."
— Seth for Privacy [02:28] -
"Full chain membership proofs... changes from 'hey, I'm one of 16' to 'hey, I'm one of any output that's ever existed in Monero.'"
— Seth for Privacy [06:44] -
"There are no centralized exchanges that list Monero now... if you deal with Monero at all, we're going to cut you off."
— Seth for Privacy [13:14] -
“Between Cake Wallet, Monerujo, and Stack Wallet, I think there's enough to cover the different approaches that people want.”
— Seth for Privacy [20:38] -
"If anyone is telling you that their privacy tool is perfect, they either don't know what they're talking about or they're lying."
— Seth for Privacy [40:10] -
"Spam attacks can be extremely detrimental... it's a concern. It's—the biggest, I think, realistic issue with Monero."
— Seth for Privacy [47:12]
Timestamps for Important Segments
- 00:00–01:10: Gabriel Custodiet’s introduction & guest intros
- 02:01–05:44: Seth’s move to Cake Wallet, overview of current Cake Wallet progress
- 06:13–12:09: Major Monero technical improvements (FCMP, Background Sync)
- 12:09–15:41: Regulatory/exchange environment for Monero
- 15:41–22:21: Monero wallet ecosystem analysis
- 22:21–25:59: Why privacy influencers often overlook Monero
- 25:59–30:16: Technical/operational criticism and background sync details
- 31:53–38:18: Discussion on full chain membership proofs, ring size/churning
- 38:18–45:04: Chain surveillance, the myth of Monero invulnerability; good practices
- 45:04–51:06: Spam attacks, chain bloat risk, dynamic block size pros/cons
- 51:33–52:13: Outro, where to follow Seth
Conclusion
Seth for Privacy, Gabriel Custodiet, and Urban deliver an unflinching look at Monero: celebrating real progress (technical and usability breakthroughs), dissecting vulnerabilities and operational complexities, and separating propaganda from real risks. The tone is both optimistic and rigorously skeptical—a must-listen for anyone using, building on, or critiquing privacy coins.
Where to Follow
- Seth for Privacy: @sethforprivacy on X/Twitter, sethforprivacy.com, Cake Wallet
- Gabriel Custodiet: escapethetechnocracy.com
For further Monero basics, check Gabriel’s prior Monero intro episode and the Escape the Technocracy course.