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What is the difference between anonymity and pseudonymity?

First, some definitions. Anonymity and pseudonymity refer to two different ways of obscuring or concealing a person’s identity. Within De-Fi, the terms have taken on a heightened meaning as users will often either maintain pseudonymity or anonymity as a way of protecting their identity and concealing their transactions.

What does pseudonym mean?

Pseudonymity is the near-anonymous state in which a user has a consistent identifier that is not their real name: a pseudonym. In pseudonymous systems, real identities are only available to site administrators. Pseudonymity allows users to communicate with one and other in a generally anonymous way. Pseudonyms are typically user-chosen names.

What if anonymity or pseudonymity is the default setting?

If anonymity or pseudonymity is the default setting, this does not apply. 2.13 The steps an APP entity should take to draw both options to the attention of individuals will depend on the nature of the dealing between the entity and an individual.

What is pseudonymity in blockchain?

Pseudonymity describes a process of using a fictional persona to conduct activity without revealing your true identity. In the context of blockchain security, this means that whilst the identity of the person making transactions is unknown, all of the transactions that they make can be linked to the same pseudonymous identity.

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