The privacy-oriented cryptocurrency Grin was launched on January 15th, 2019, by a group of anonymous blockchain enthusiasts. This project was one of the first ones to implement the new protocol Mimblewimble providing its users not only with total privacy, but also resolving the scalability issue which can be regarded as one of the biggest flaws of all Bitcoin and Ethereum-based cryptocurrencies. The key goal of Grin, according to its official website, is to provide electronic transactions for all, without censorship or restrictions.
Driven by the community, Grin didn’t conduct an ICO and hasn’t raised any funds for its future development. There was no pre-mine or founders’ rewards and the long-term development is fueled solely by donations.
The name of this protocol is a magic spell from a popular kids’ book series about a young wizard Harry Potter. Another reference to this fantasy universe in the nickname of the user who first represented it in the IRC research channel #bitcoin-wizards in 2016. His pseudonym was Tom Elvis Jedusor which is a French name of Lord Voldemort, the chief villain from this fairytale.
Some time later, another user named “majorplayer” posted a document on the same channel describing the new approach to the Bitcoin network based on this technology. The document caught the attention of Andrew Poelstra, a researcher from Blockstream, and inspired him to develop this idea further. The updated white paper was released on October 6th, 2016.
Before describing Mimblewimble technology, one should understand how Bitcoin transfers work in general. When someone sends bitcoins to another wallet, no real money is transferred anywhere. Instead, 2 new lines show up on the public ledger confirming the changes in amounts of bitcoins stored on two addresses. Mimblewimble implements the so-called “blinding factor” to disguise this information. Also, it uses the technology CoinJoin which implies combining all transactions into a single pool for confirmation which makes it totally impossible to track participants. Such an approach allows verifying transactions instantly and getting rid of an excessive superstructure of blocks that make up the blockchain.
Grin is based exactly on this protocol. With Grin, there is no public ledger and no wallet addresses, the amounts are sent over the network in an encrypted way. Just like Bitcoin, Grin is based on the Proof-of-Work mining algorithm, but thanks to Mimblewimble, it lacks the scalability issue and allows processing practically infinite number of transactions per second.
Grin is not the only project based on Mimblewimble. Its key competitor, a commercial project Beam, was launched only 2 weeks earlier.
Grin is an open-source community-driven cryptocurrency run by a council of developers, a mining community and other interested users scattered all over the world. Its code is written in the programming language Rust.
From the privacy perspective, its key competitors are Zcash, Monero, Dash, Pivx and a few others. The coin can be purchased on many cryptocurrency exchanges including Gate.io, Hotbit, BitForex, BitMart and many more. The Grin wallet is available for download on the project’s official website. It comes without a graphical user interface which is not very convenient for non-tech-savvy users, but some community projects (Niffler, Grin++ and Ironbelly) resolving this problem can be found on the same page.
Grin’s initial supply was equal to zero and the mining process started on the next day after the coin was launched, i.e. on January 16th, 2019. New Grin Coin is issued every second with a block reward making up 60 grins. The coins’ emission is linear which means that it will remain the same over the whole emission period. Due to the light weight of the Grin’s network, the synchronization process takes way less time compared to Bitcoin where it may take up to several months to get a newly setup node fully synchronized with the rest of the network.
Since there is no central authority responsible for the project’s development, the necessity to have an organized governance system is obvious in the case of Grin.
In addition to conducting regular development meetings, the Grin community also has governance meetings on Gitter every 2 weeks. Any interested party can attend these meetings and contribute to discussions. After the meetings, the summary of what has been discussed is posted on GitHub ensuring full transparency.
Despite resolving the two key problems associated with Bitcoin, Grin comes with some additional flaws. For one, it requires both participants of a transaction to be online simultaneously. There is a workaround which implies running the wallets on servers that are continuously on, but that would lead to the network’s centralization. This is something that Grin is trying to prevent by all means with the ASIC resistant mining algorithm.
Another problem is associated with usability. The wallet for storing grins is only available through a command-line interface which may be inconvenient and even scary for non-tech-savvy users.
In addition, on November 19th, 2019, a researcher Ivan Bogatyy from Dragonfly Capital revealed Mimblewimble’s weakness in his post on Medium. According to his article, he was able to conduct an attack on the network and uncover the exact addresses of senders and recipients for 96% Grin transactions having spent only 60 USD per week on AWS.