Packets are encrypted in several layers and relayed through a multi-layered network called a mixnet.
In each layer of the mixnet, mix nodes mix your internet traffic with that of other users, making communications private and protecting not just your content but your metadata (your IP address, who you talk to, when, where, from what device and more)
Users pay a fee in NYM to send their data through the mixnet. By pledging an initial bond of NYM, anyone can run a mix node. Node operators are rewarded in NYM tokens based on reputation measured in staked NYM tokens and their quality of service (uptime and packets dropped) providing privacy for the end users.
This is called ‘proof of mixing,’ similar to how Bitcoin rewards miners for mining new blocks. The reward mechanism enables the mixnet to scale and remain decentralised and economically sustainable.
From Bitcoin to ZCash, no current “layer 1” blockchain provides “layer 0 privacy” for the peer-to-peer broadcasts used in crypto transactions. Nym can provide network-level privacy for any blockchain and other generic applications.
From Bitcoin to instant messaging, developers can build their applications on top of Nym, offering powerful network-layer and metadata protections for the people and organisations using their services.
The most popular network-level privacy solution currently is the VPN (virtual private network), which provides protection via an encrypted tunnel between a user’s computer and one run by a VPN provider. VPNs are often misconfigured, however, and even when configured correctly, don’t offer real privacy or adequate resistance to censorship.
VPN providers can also fully observe all network traffic between users and the public internet, knowing exactly what services its users are accessing at a given time. The user must trust that the VPN provider is not using their information in a malicious manner or keeping logs.
The Nym mixnet is an anonymous overlay network that provides strong network-level anonymity, even in the face of powerful systems capable of passively monitoring the entire network. The Nym mixnet is decentralised, with no trusted third parties, and so does not require a trusted provider like a VPN.
Tor provides better privacy than single-node VPNs. The Tor network solves the network layer surveillance problem by routing a ‘circuit’ through three relays.encrypting traffic multiple times, so that only the final Tor node can see the destination. However, Tor’s anonymity properties can be defeated by an entity like an intelligence agency that is capable of monitoring the ‘entry’ and ‘exit’ nodes of the entire network. Tor’s design is expected to continue to be the best network layer privacy solution for web-browsing and other stream-based traffic. Mixnets have higher latency but provide stronger network layer privacy properties, defending also against a global passive adversary capable of monitoring the entire network. By adding timing obfuscation and cover traffic,traffic patterns are obscured, protecting against any attempt at correlating flows and deanonymize users.
Nym can provide more powerful network-level privacy for cryptocurrency transactions, e-mail, instant messaging, and any other message-based traffic. Unlike Tor, Nym’s mixnet design guarantees network anonymity and resistance to surveillance, even in the face of adversaries capable of monitoring the entire network, by adding cover traffic and timing obfuscation. Rrather than operated by a trusted provider like a VPN, the Nym mixnet is decentralised, using blockchain technology and token economics to organise the topology of the network. Nym node operators are incentivized to run nodes and provide good quality of service and uptime. Software updates are governed through community adoption as decisions are made by the node operators and token holders.