Ethereum founder Vitalik Buterin made headlines on Monday after his latest on-chain move. Buterin’s $1 million in ETH transfer to privacy protocol Railgun caught the attention of the community and reignited the debate over the use of privacy tools.

Vitalik Transfers 400 ETH to Privacy Protocol

On Monday, online reports revealed that Vitalik Buterin once again transferred over $1 million to Railgun. The project is an Ethereum Virtual Machine (EVM) privacy protocol that uses Zero-Knowledge (ZK) cryptography to enable private use of DeFi and smart contracts.

According to on-chain analytics firm SpotOnChain, Buterin sent 400 ETH, worth approximately $1.054 million, to the privacy protocol earlier today. Before the transaction, he made a test transfer of 0.0998 ETH, worth $2,629.

His latest transfer to Railgun was one of several times he used the privacy tool. According to the report, Buterin has sent 662 ETH, $1.91 million, to the protocol over the past 10 months.

Vitalik Buterin's transfers to Railgun. Source: SpotOnChain on X 

Earlier this year, Buterin made a transfer of 100 ETH to Railgun, which sparked an online debate. Some community members questioned the reasons behind the transfer and criticized his desire for a private address.

Many users supported Buterin’s use of privacy tools, as all of his on-chain movements are scrutinized and speculated about. He responded to the criticism at the time by stating, “Privacy is normal,” and explained that Railgun is an effective tool to protect user privacy.

Additionally, he highlighted that the project uses the Privacy Pools protocol, which he has researched over the years, which makes it “much harder for bad actors to join the pool without compromising user privacy.”

Railgun tackles misconceptions

Buterin’s latest port has reignited the privacy debate, with some questioning why Railgun is “okay” while Tornado Cash is “bad.” To address this, Bill, Railgun contributor and CEO of MetaMask’s seed phrase recovery team, set out to clear up some misconceptions about the privacy protocol.

As explained on X, Railgun shouldn’t be called a mixer, because it isn’t. Instead, it’s “an address system that provides privacy” and works like other wallets where a private key controls tokens.

Bill explained that Railgun’s privacy comes from using the private address instead of mixing tokens:

Privacy comes from using this address, not from mixing or moving tokens. Vitalik is just sending tokens from his public address to his private address here. He doesn’t have to move tokens out to get privacy, he can leave them in his private address forever or do other on-chain things like swaps with them, we as avid wallet watchers wouldn’t know.

As a result, he believes it would be more accurate to call the protocol a “privacy system.” Another community member questioned the purpose of a privacy system, stating that the “whole point of crypto” is to “see it live on the blockchain when it’s posted.”

Bill addressed this by explaining that all Railgun transactions are valid Ethereum transactions based on the network rules. The difference is that these have identifiable information hidden.

He called the process “public DeFi but private wallet,” emphasizing that when people use a smart contract with Railgun, they “can still see what’s happening in the contract,” but their actions are private.

Ethereum (ETH) is trading at $2,580 in the weekly chart. Source: ETHUSDT on TradingView

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