Token Privacy

Definition ∞ Token privacy refers to the degree of anonymity or unlinkability associated with transactions involving digital tokens on a blockchain. It concerns the ability of users to conduct transactions without revealing their identities or the details of their financial activities to unauthorized parties. Different cryptographic techniques and protocol designs offer varying levels of privacy protection.
Context ∞ Token privacy is a significant and often debated topic within the cryptocurrency space, balancing user anonymity with regulatory demands for anti-money laundering and know-your-customer compliance. Privacy-focused cryptocurrencies utilize advanced cryptography to obscure transaction details. News frequently covers regulatory actions against mixers or privacy protocols, reflecting the ongoing tension between financial surveillance and individual data protection. Technological advancements aim to address these complex requirements.