Quote from: Jack N Hoff on April 28, 2013, 01:42 amQuote from: lukeuser on April 27, 2013, 05:19 pmWait, wait! There's more!Brainflash!This is my new, improved way of understanding Zerocoins:They *AREN'T A NEW COIN*! Zerocoin is a protocol which enables a new way of possessing Bitcoins. Instead of using the current 'address' system which is currently integral to the Bitcoin infrastructure, it uses serial numbers. Any serial number is used instead of an address to store Bitcoin value, but unlike an address, it cannot technically be traced to either any Bitcoin transaction (not even the one that created it), or any specific Bitcoin. It is only accociated with any transaction/address when it is eventually 'spent', i.e. converted into an address-stored Bitcoin.8)This would require some type of central authority or blockchain to verify legitimacy of serial numbers and such correct?Well not necessarily: you could generate private keys and compute the corresponding public keys from the private one using a one-way hash function, and require that anyone wishing to spend the coins listed as "at that address" be able to prove they have the private key... the thing is, that's basically what Bitcoin does now.That's what a bitcoin address is, the public key. The private key allows you to spend the coins at that address. A wallet is a collection of public and private keys. The blockchain is a record of who has what coins, and you can't spend the ones at an address without the private key -- otherwise nobody will pay any attention to you. That's my understanding of it, anyway.They also *have* to be the same coins, just with a layer of obfuscation -- the details of which I can't picture, but at some level they must reduce to the current Bitcoin blockchain. Otherwise they'd be a competing crypto currency, not an extension of Bitcoin.