Unchained - What Ethereum Will Look Like When It Implements Its New Privacy Focus - Ep. 959

Episode Date: November 25, 2025

The Ethereum Foundation last month said it was taking its privacy efforts a step further. It announced the Privacy Cluster, a group of 47 coordinators, cryptographers, engineers and researchers with one mission: to make privacy “a first-class property of the Ethereum Ecosystem.” At Ethereum DevConnect, the EF's Andy Guzman and Oskar Thorén join Unchained to discuss the formation of the group in the context of Zcash's recent resurgence, why privacy is important for crypto and the motivations behind Ethereum's recent push. They also delve into the difference between the current privacy push and past efforts, as well as how it could unlock new use cases and the reaction of institutions. Additionally, they talk about competition with Zcash, reveal implementation timelines and delve into the impact on crypto data analysis. Thank you to our sponsor ⁠Uniswap⁠! Guests: Andy Guzman, PSE Lead at Ethereum Foundation Oskar Thorén, Technical Lead of IPTF (Institutional Privacy Task Force) at Ethereum Foundation Links: Unchained: Ethereum Foundation Launches ‘Privacy Cluster’ Vitalik Unveils New Ethereum Privacy Toolkit ‘Kohaku’ Why the Privacy Coins Mania Is Much More Than Price Action With Aztec’s Ignition Chain Launched, Will Ethereum Have Decentralized Privacy? Timestamps: 🚀 00:00 Introduction  🥷1:33 What is the Ethereum Foundation Privacy Cluster? 🤔 3:49 Did Zcash's resurgence inspire the launch of the Privacy Cluster? 📽 6:29 How the Privacy Stewards of Ethereum has grown over the years 🔗 8:39 How the Institutional Privacy Task Force's got started 💡 10:10 Why privacy is important in crypto 🔮 13:54 What is driving Ethereum's recent privacy push 📝 15:21 Andy and Oskar discuss their backgrounds 🤔 16:48 The difference between Ethereum's current privacy efforts and past efforts like Tornado Cash 🤞18:43 How Ethereum's privacy push could unlock new use cases 🛣 25:09 Andy and Oskar outline different approaches to privacy 🤔 29:52 What are private reads and writes? 👀 35:16 Why Andy says adopting onchain privacy is a question of risk for institutions 🫆 36:39 Why private identities are important 🤔 40:13 What happens if identity proofs are stolen  📺 43:27 How the Ethereum Foundation wants to improve privacy experience  🧏 45:44 How the IPTF’s role is unique  ⁉️ 47:51 What is Kohaku? 👀 51:02 Is Ethereum competing with Zcash? 💡 1:01:29 The Ethereum Foundation's thoughts on private viewing keys  🗓 1:03:44 Implementation timeline 🔮 1:05:50 How the crypto privacy push could impact blockchain data analysis  💥 1:08:46 Final thoughts Learn more about your ad choices. Visit megaphone.fm/adchoices

One of the misconceptions that many people have even just like starting in the space is like thinking that by default, crypto is private, which is not. Or it's anonymous and it's not, right? It's pseudonymous. So basically, whenever you do an action on blockchain like Ethereum or Bitcoin or most of the other public blockchains, those actions get recorded forever. And that could be like legal risks, that could be personal risk, that could be like financial risk as well, just leaking all your information and storing it that in a blog scene where you cannot delete it, you cannot edit it. Hi, everyone. Welcome to Unchained, your no-hyped resource for all things crypto. I'm your host, Laura Shin. Thanks for joining this live stream, which is pre-recorded.

I should let you know. Before we get started, a quick reminder, nothing you hear on Unchained is investment advice. This show is for informational and entertainment purposes only, and my guests and I may hold assets discussed on the show. For more disclosures, visit Unchained. crypto.com. Are you a builder who needs to add on-chain trading to your product? The Uniswap Trading API from Uniswap Labs offers plug-in-play access to some of the deepest liquidity in crypto. It's on-chain execution at an enterprise level. More liquidity, less complexity. Visit hub.uniswap.org to learn more. Today's topic is Ethereum Privacy and here to discuss are Andy Kuzman, PSE lead at the Ethereum Foundation, and Oscar Torin, a technical lead of the

Institutional Privacy Task Force at the Ethereum Foundation. Welcome, Andy and Oscar. Yeah, thank you. Thank you. So in early October, the Ethereum Foundation announced that it was establishing what it was calling the Privacy Cluster, a team of 47 researchers, engineers and cryptographers coordinated by Block Scout and Exstive founder Igor Baranov in order to establish privacy as a first-class property of Ethereum. Explain what the privacy cluster is and what its mission is. And Andy, why don't you start? Right.

So I will say the privacy cluster is this very focused effort on trying to make Ethereum more private, and bring it more and make it a default. So actually, the Ethereum Foundation has a long history into just bringing more researches engineers into this area. PSC, or Privacy Stoarts of Ethereum, is one of these teams who has been running from since 2019, exploring new use case. on privacy on identity, a duplication layer, privacy on reputation,

privacy on many different aspects that I can go deeper later. But this is a renewed effort with more resources, with more people, into just expanding and pushing this space of privacy. So the privacy ecosystem on Ethereum is already very big, but it needed to have a bit more of like coordination, focus and focus on different areas that perhaps before we were exploring.

And Oscar, why don't you explain what the mission is for the privacy? cluster. Yeah, so IPTF is a new team, so institutional privacy task force. And basically what we're trying to do is we're trying to get institutions to build on top of public block chains like Ethereum specifically with the focus on solving their privacy requirements. That's basically the mission.

And I think that also is very much in line with some of the recent changes at the Fium Foundation with the sort of new executive leadership coming in and an increased focus on sort of ecosystem developments and so on. So I guess more broadly at the EF, there is the protocol cluster, which focused on on L1 and then this is an Equidav cluster and then the privacy cluster. And IPDF, I guess, it's a little bit between, mostly in the privacy cluster, but also with some connections to the EcoDev cluster and specifically the enterprise team

that talk to some of the biggest institutions in the world. And I guess what we've seen is that like it used to be that regulation was the primary blocker, but nowadays, or especially this year in the last few years, the privacy is actually the main blocker in terms of these institutions moving on train. Yeah. So privacy has become a huge trend in crypto, as I'm sure you guys are aware. And to me, it feels like this wave started with Zcash back in late September.

And then the announcement from the EF about the privacy cluster came in early October. And I couldn't help but wonder if it was sparked by, you know, what we were seeing in the market or if this initiative had been in the works. Just explain generally how it came about. So I would say that the renewed focus just started beginning of this year even with more. So it's been like a long brewing. And again, as I've said, like, the team has been, like, expanding and growing. And I would say it's just like very nice timing and convenience that the market recognized the importance.

So we were already seeing the need, the adoption, the force, I guess. So perhaps, yeah, it could have seen like we kind of reacted. But in reality, like, this team and, you know, the blockposts, the mission statements, the kind of the investment and the roadmap and strategy has been, you know, preparing all this year, more specifically in the last kind of like second half of the year. So yeah, it's just like nice consonants. Yeah, I would echo that and also say like, so we're in the privacy space and related to Ethereum for the last seven years or so.

So I think this has always been a very big focus, like privacy in terms of the Ethereum ecosystem. And obviously, products like CCAS started early and have done a lot of pioneering work. But I think if Ethereum ecosystem is like also been very early and building a lot of these kind of core technical primitives that are then being used and creating these kind of, uh, new verticals, if you're like if it's CQID or CKTLS or CQMs and all of these things. And I think historically also going back to what Andy mentioned is that PSEC used to be kind of its own organizations. There's already been like a massive effort funded by the Firm Foundation. I think what is new this year is that it sort of focuses mission a little bit and focusing on IPFRIM specifically and not sort of privacy broadly in sort of the ecosystem.

So I think that is the main shift. So it was very much like a proactive thing. And whatever's been happening recently, that's more of a coincidence, I would say. Yes. Okay. I don't think I knew that before. So privacy stewards of Ethereum started as a separate organization, and then it kind of got folded into the EF. Right. It has always been part or supported by the Ethereum Foundation, but it operated a bit more externally.

And I think that makes sense in that earlier years, because like the primitives, like the creative, kind of like creativity, or most of like kind of like just needs or explorations where it made sense. But right now, it made a lot more sense to kind of refocus 100% on the Ethereum space and not as broadly, and also to just better connect and collaborate with the rest of the Ethereum Foundation teams that existed. Okay. And so explain what PSC is and a little bit about the history? So PSC is a group of teams, a collection of teams, that focus on bringing privacy. And it seems to respond from, I guess, 2019, 2018, where it started with a small group of cryptographers and cryptographers, researchers and engineers exploring this new frontier that was zero knowledge proofs. So it started with experiments on private identities, primitives and libraries and applications

in which you can prove your identity that you were part of a group without revealing all the details of yourself. And this experimentations were looked by the Ethereum Foundation and basically started supporting this team into growing from one, two, three, 30, up to I think almost like 50, 60 or 80 at some point. So it started as a team who were kind of one of the first teams exploring roll-ups, like one of the systems that Ethereum uses for scaling. The first team, within the PSE, the first people

who explored CK EVMs, so also one of the main kind of scaling strategies that Ethereum uses. The team that supported TLS Notary, which is the pioneer in all that we call CKTLS. So all these spacing which we can make proofs about TLS connections. And it's just like a bunch of other example like those that basically just expanded the use cases that we can bring to Ethereum. So before PSC was broadly exploring all these use cases

in both privacy and scalability. So that was what it used to stand for. And now it's 100% focused on privacy for Ethereum. Okay. I would also say that it used to be that because so much of this was like cutting edge research. And at the time, we didn't even know if it was possible to do any kind of have any meaningful impact there. But I think what ended up happening is that there's been so much development in actually making these tools practical. And we see that now in the industry as a whole.

And I think Ethernet has played a big part in making it even possible. And that also has led to this like renewed focus in terms of actually bringing this into production and more having a larger impact beyond sort of smaller R&D toys kind of thing. And then is the institutionally, institution, Why do I keep saying that? Institutional Privacy Initiative, is that, or whatever it's called, Institutional Privacy Task Force,

is that within PSC? Is that like a group within it? Yes, it's within the privacy cluster, and it's, but it also has close collaborations with, for example, the enterprise team at the InecoDef, yes. Okay, and how did that get started? Sorry? How did that get started?

I guess only two or three months or so. We have talked about it a bunch. I think what ended up happening is that as E.S.E. sort of did the restructuring, and there was more focus on being someone that institutions and enterprise would come to and have someone to talk to, it became very, very clear, and especially now with like the Sablecoin Acts and things in the Genius Bill or Mika. Like all of these things are happening in the US and Europe and Japan, Hong Kong, Singapore, all this regulation and all this clarity that has led to

of renewed interests from institutions. And it's sort of painfully clear that the main blocker for them, it's like the need for privacy. So it became very obvious that we needed to do something about this because the enterprise team is great in terms of being able to have these initial conversations with these major institutions. But we have this very amazing R&D lab at PSC and all this amazing resources, and we basically tried to connect the two dots. So as historically, it's been purely focused on most of individual like cyphepunk privacy. Now we're also trying to recognize that there's other actors that need privacy and we can also be very useful to them. So let's talk about why it is that privacy is important in crypto.

And, you know, this is the kind of thing where sometimes I feel like people in the U.S. in particular, they may not understand it. But I would love to hear, you know, why you think it's important for crypto to be focused on this. May I both start just for individuals, right? So one of the misconceptions that many people have even just like starting in the space is like thinking that by default, crypto is private, which is not. Or it's anonymous and it's not, right? It's pseudonymous. So basically, whenever you do an action

on blockchings like Ethereum or Bitcoin or most of the other public blockchains, those actions get recorded forever. And that could be like legal risks, that could be personal risk, it could be like financial risk as well, just leaking all your information and storing it that

in a blockchain where you cannot delete it, you cannot edit it, right? So that is just like a huge need for users. And I would say like all these cyphropunk movement, all this like start of this industry came from self-suffering individuals and had like really strong ties to, you know,

privacy technology in itself. So as I said, like it has always been the case that privacy has been important but perhaps the tools just lack more maturity just in order to kind of like reach this inflection point of like one like we need it and two, it's possible.

It's getting, you know, easy to use. It's cheaper to use in And just basically it seems to be like the inflection point for individuals to use it is coming now, right? And we can see also the market and we can see kind of like the attention, but at the end of the days, it has always been the case where privacy and having the freedom and the power to control who sees what from your information and your assets, it goes back to kind of like the core values of these movement, I'll say. Yeah. And I would say like, yes, definitely just like they come from these sort of cyberpunk origins and so on. and privacy and the connection to freedom and self-saventity.

I would say it's also like very practical in the sense that if you look at various hacks that happen or for example ledger when the addresses got leaked, it had like very real-world consequences in terms of like people's address being being leaked and that was like led to actual physical attacks. So I think people are recognized it's more and more important. I would also say that like when we took it, think about something like cash, if I buy a coffee here, they can't see my entire sort of my, my income or my assets.

All they know is like this bearer asset like cash. And I think we have things like banks, bank systems, and they have similar properties, but obviously they can be censored, and they have all these other problems and social with them. So we have with public blockchain like Bitcoin Ethereum, they're great in terms of being digital and permissionless and so on, but as Andy mentioned, they are sort of transparent by default,

which means you can actually sort of track things and so on. And what we're trying to do is kind of regain those properties that are more like cash like properties. And I would also say to your point that it's maybe not as valued for a lot of people in developed countries like US and I'm from Sweden. It's definitely seen as less of a problem. But I would say in lots of parts of the world, there are more adversarial circumstances where it matters a lot more. And I think as the world is moving more towards U-S. Blox and technology, even you see attacks in like Paris and Miami, it's very much a real problem. I think people are waking up to that as more and more assets move on chain.

And then there's also the institutional side, which is separate in terms of what they need private support, yeah. And I'm sorry, when you say Paris and Miami, are you talking about... I'm talking about, like, various attacks that happened and... Like, wrench attacks? Yeah, yeah. Okay. And, you know, for... You said, you know, Ethereum has been working on this for a few months, or really, you said all of 20205.

Is that because, like, you're seeing demand from people, or is it just, like, you know, Ethereum is working from... ideals and what it would like to become? Or is it that like people are actually requesting this type of feature? So I'll say definitely both. So again, there's a rich history of this, but it definitely seen a pickup about the right moment of how technology matures and how, you know, institutions demanding and how just in general there's like a renewed sense of need, I guess, in the ecosystem of just re-emphasizing this property. So how I've been seen is like the Ethereum is focused a lot, and he's focusing a lot on scaling, I'll focus a lot about on usability, on maturity,

all the technical stack of the layers. And it just seems now that a good breakaway case, again, will be just turning privacy into like a day-to-day actions. And I would say, yeah, definitely on the individual case, and on the institutions side, we're definitely seeing a lot of demand. Like, this is their blocker. Like, they do want to move on chain and they want to move to Ethereum specifically, but they are not sure about how to get the privacy property.

So that is just like they need it. It's not a question of like, oh, maybe. It's like they need it. Yeah. It's a table stakes requirement for institutions where if they don't, either they don't mean regulation or there's like big financial or business risk, right, of losing all their practices, their client. Yeah.

Yeah. And do you have a background where you worked with banks in the past or what were you doing before? So I worked in like a Fin Diggas. I come more from the protocols of research and the infrastructure sites. I've been working on sort of private solutions. and P2PIC protocols and designing more secure systems and applied technology proofs. We have people in a team that sort of have an extensive background,

worked at Goldman Sachs for many years and so on. And then we also have the enterprise team that has also have very close connections to these institutions. So we're definitely more on this sort of tech and research side of things, but we have excellence of support teams and great talent that allows us sort of talk to these main institutions and understanding in language, and I think that's very much a challenge.

And what we're trying to bring to table is like taking these like business requirements and translate them into something that the technical community can understand, as well as sort of the legal angle, which is also very important to understand what does this mean for existing regulation and future regulation and how does that connect to technology. And that's something that I don't think anyone has really done and we're basically trying to demystify that a little bit. And what's your background? So background in engineering, like let the engineering, you know, management of teams and all sorts of development like web two and now more closely like web three and you know been working doing more product um for crypts very cryptographic protocols and open source tooling that we have been building okay so you know up until this point ethereum actually has has some privacy you know activity i guess you could say on ethereum right so you know how do the current

efforts differ from the past efforts. And I have to wonder if part of the reason now that it's being brought into the Ethereum Foundation is because some of, you know, the legal stuff around what happened with tornado cash has been resolved. So I don't know if that also played a role. It's kind of two questions. Right. Okay. So I would say like, again, like tornado cash is like one of the, you know, biggest like protocols of privacy. And there's, there was a lot of unclarity and a lot of like risk and fears and that definitely caused chilling effects on the ecosystem. But on the flip side, there was also like good understandings and maturation and even conversation that sparked of like what does privacy protocols that can also be compliant

makes, you know, looks like in the futures, right? So this is not only a conversation, you know, the Ethereum Foundation had, but rather like the whole Ethereum ecosystem and crypto ecosystem in broad kind of like made a push and an hour continued to push it for like more clarity. So that is on one side. On the other side, it's just like there continues to be demand, right? So the more users, the more institutions, the more like, I don't know, public, you know, governments as well want to use this public blockchain. There's like an increased, you know, need of these tools.

So definitely it played a role. But I will say, like, in parallel, it's just like, yeah, broader, broader demand. I would all say the technology has evolved a lot. So like, Turnercast was a very useful primitive. but we can do so much more now and more cheaper and so on. We have more expressive systems. So I think it sort of goes hand in hand. There's been so much accelerated R&D

that the things we can do now are way, way more than just a few years ago. And that also impacts the kind of use cases that can be applied. So I'd love to hear you describe once what you're working on has come to its full fruition, like in your head, what's the ideal version of what this looks like? walk me through, you know, maybe a comparison between like transactions today versus transactions in the future or, you know, certain applications or use cases that you think would be enabled once everything that you're working on comes to fruition. I'd love to hear kind of what the vision is.

Okay. So maybe I will start what's saying, like, right now we don't have metadata privacy. So metadata privacy is like all the things that you leak or information that you leak before you even do an action on the blockchain. So, Things like whenever you open a wallet, you're leaking your IP addresses with the information that the wallet address, you know, the on-chain address that you have. And there's a correlation to that. You're leaking what tokens you're pulling from, the price, the gas. You're leaking everything at the end of the day into all this merit of infrastructure that exists just to provide, like, users, you know, most helpful. So current state is like you're leaking everything.

Future state is like how can we give anonymity and confidentiality to all the requests that we do? And that is what we call within our closet like private reads or metadata privacy. So every time you do a transaction or every time you try to read from the blockchain, you can do that privately. The other aspect would be like unchain privacy or financial, which have many different use cases, right? So in Ethereum, because it's such programmable, you can do all these financial use cases, where I can talk in a bit, but you can also do all these like governance use cases, right? So things like dows, things like voting, things like delegation and voting,

Those are all things that have been maturing over the years, and that just basically by, you know, keep adding, keep keeping, like, developing these infrastructure just makes sense to eventually have more corporations, have more local governments, local associations, just leverage these other use cases on chain, right? So it's maturing, and I will say, like, it will continue to solidify, increase kind of like the strength, the security of all these systems. Well, don't you, wait, so one question about the downloading? Because right now we can all see. when it's like a whale who's dominating the vote or, you know, whatever. But in this world, will that not be visible? It could be possible that you design new use systems that are not only token dependence. So one of the drawbacks of basically one vote, one token is like basically whales dominate kind of like the narrative.

They dominate the kind of like the outcomes of the voting in many of these dows. But there could be a system in which you just generate as your knowledge proof of that you're an individual that you have participated of a specific event and that gives you access to just one vote. And then it would mean like it's very hard or it's impossible to game the system and will actually be more like democratic processes. There are like many teams here building primitives called like zero knowledge, CK passports or CK identities where there are basically one to one map to an individual.

So without disclosing the specific, you know, your name, your specific, you know, personal information, you can still prove that you can vote. So there are like many new use cases that we can explore and that we can, that are currently being built in the Ethereum ecosystem that go beyond even financial, you know, yeah, financial use cases. So I would expect like in the future there will be like more, you know, local governments or even like institutions and corporations using unchain mechanisms for their deliberation decision processes.

And I would add like also for example on the CKID side, spend lots of efforts at PSC. So even make it possible because a few years you go, that was not something that was possible. Another thing is that you want to be able to do that on a client site, for example, from your mobile phone. Because what you're trying to prove is that you have, you're in possession of a passport or something like that. If you upload your passport to a centralized server,

that then does that, you kind of lose the whole point. And that's the use as like a building block in lots of system when it comes to like KYC or voting and so on. So I think there's lots of these small billing blocks. And the same thing goes for something like CKTLS that's used in certain on and off ramps and the same thing for CKVM. So I think there's lots of examples of these technologies starting out at R&D products and then coming to fruition and now sort of having a very real impact.

I would say it's a very new team. It's only been on for two months or so. We have done a lot of mapping work because what we are trying to do is basically we talk to these major institutions, the biggest issues in the world. Usually a bit more on the financial side, but we also talk to some NGOs and government And we try to understand what is precise business needs and requirements. And we try to document that and make as much of it public as possible. And what we try is connect that to what is going on in ecosystem.

Because the ecosystem has developed all these technologies and primitives and there are various vendors in the space. And we tried to make that very explicit, like here's the business use case, here are the requirements, as well as the legal requirements, like what do you're operating under? Because it's very different in US versus Europe versus Japan. And then we try to connect it to what's going on in the Ethereum ecosystem with various types of specifications or standard ways of doing things or mature vendors that are already providing similar solutions and create these kind of feedback loops where if a vendor or a set of an approach is a perfect fit for institution, then we can say this to the institution. And to the extent that some things are missing, we can also highlight that the ecosystem and say this is what the institutions are asking for. And I would also say the reason that institutions come to us and why this IPTF team sits at the Ethereum Foundation is because we can be credibly neutral. We are basically responsible for the Ethereum ecosystem and we're trying to onboard people onto Ethereum.

And then we are neutral when it comes into vendor choices and so on. So that's like where a lot of the focus for IPTV has been. And we had like a few workshops with major institutions where they are exploring maybe a stable coin or bonds or Eurolast or something like that. And they have a specific set of questions. And it might be the case that they get approached by like a BD function at some other, from some other ecosystem. And they know some things, but they might be a bit confused. And we try to sort of clarify for them, like, here's what's happening, here's what's possible today.

Here are the tradeoffs. Here's how you should think about it. And that's kind of how we approach it with the goal of eventually them moving on chain. Okay. So now let's talk about the specific, you know, approaches to technology, like the different sorry, to privacy, the different technologies that you are, you know, considering and, like, how you would apply them, you know, which use of cases you think certain technologies are more appropriate for or even, you know, demographics potentially. Yeah, and I know there's probably trade-offs

with each one. So I'd also love to hear, like, how you think about that aspect for each approach. Right. So I'll say, like, first is, like, mapping what are the use cases, right? So, for example, I would say like most people when they think privacy and crypto, they think of private transactions, like sending money to another one and private defy, at least within the theorem ecosystem. So within private transactions, there's like at least from like an initial mapping that we're there, like at least 12 different families or approaches of technologies. So things like mixers and shielded pools are technologies that are already like zero knowledge-based and they have some properties that gives really strong anonymities depending on how much usage

they have. There are things like proof of burn, which is more experimental newer technologies that allows to kind of like, again, do a private transaction, but by using leveraging other type of primitives that basically doesn't need funds to be mixed together. It's like it hasn't been battle tested. There's still not needs to be some maturity for this technology, but it gives like a very nice exploration about some different paths that the ecosystem can take. There's this other one called stealth addresses, which basically generates a new address each time you receive funds. And that is more similar to the UTXO model, but maybe other chains like are more familiar. And what this allows you is to unlink the different addresses that you have.

So it's a bit of privacy for the receiver. So if you combine all these technologies, and there's other ones, right, like FHE base or amorphic encryption base that allows you to send funds and you know the sender and the receiver, but you don't know the asset and the amount that gives you confidentiality. There are others which are based on hardware considerations like TE or trusted execution environment. So that allows, again, to just be very programmatic

about what you can share and what you want to encrypt and the encrypt and all the authentication layers and authorization layers. There is multi-party computation or MPC, which is like a way to operate into reduced set of parties. So if your use case requires less amount of participants, maybe MPC is a good fit. And there is foliumomorphic encryption, which is how do you operate privately or in encrypted data over a server.

So all of these have kind of are strong cryptographic primitives, or I will say like, families of technologies that are very powerful, some use cases. If I were just to say kind of the key differences or how you could kind of try to categorize, them is like you will be doing tradeals at cost, cost, how much you pay to use them across speed, like how much time you need to do a transaction to keep certain levels of privacy. The other one is user experience, so one are more complicated than others. There are things about trust assumptions, like how many people need to collude to take out your privacy and privacy guarantees. And again, like institutions or perhaps like other type of users might prefer.

technologies that they can kind of rely more on hardware that are more permission that are more compliant versus other type of users perhaps for daily payments they just want something that is cheap and that is easy to use and they don't care to be like extreme privacy and there are others which is like I don't know high network transactions where they want like maximum privacy but they run like on mobile phones right so that is where like at least these different families of technologies complement to each other and I would expect as we mature that we can better categorize and surface those trade-offs.

And at the end of the day, probably combine some of these to have, like, end-to-end privacy, which is right fit for the right type of user. Yeah, without that, like, it's very much because it's applied cryptography, so there's a lot of various techniques and you can combine them in all kinds of ways and it can get kind of gnaw when you get into details. Like, if you have a roll-up, for example, that the proving system you would use is very different from if you're trying to do some CKID solution that has to run on your phone. So it's very different depending on their deployment and also the specific threat model and so on.

And yeah, there's also things when it comes to more metadata privacy, if it's on-new routing and mixed-ness. There's a lot of different technologies. And I think as Andy mentioned, they sort of be different in terms of security and trust assumptions and performance as well as like just technical maturity as well. So depending on there's a lot of very promising reasons that are happening now that might only be actually widely deployed in a few years from now. And that's just a natural cycle of things. Just like, Sinos proofs used to be this thing that was more of a research problem, like five, five, ten years ago. And now we're seeing more and more widely deployed. And you have similar things going on with FHC where it might take a little longer to reach its full majority.

Okay, yeah. I mean, just listening to it all, I'm just aware that it's in a way it's like you're going to create so much optionality. And then there will be multiple combinations that people can use to, you know, achieve their goal. Hey founders and developers, if you're looking to bring on-chain trading to your product, wallet, or platform, check out the new Uniswap Trading API from Uniswap Labs. It's your plug-and-play gateway to global on-chain liquidity, no deep crypto experience required, and no need to manage complex integrations or ongoing maintenance. With the Uniswap Trading API, you'll get enterprise-grade on-chain execution, combining both on-chain and off-chain sources for the most competitive prices. Simply put, more liquidity, less complexity. And this isn't just any API.

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Explain what that is and how it's being resolved or like the different ways that you're approaching that. So private reads, I will say, is all these privacy that you want to ensure whenever you query the blockchain. So whenever you read the blockchain, so if this was a book, you don't want people to, to know which pages you are reading particularly, or which sentences, because you might leak information about who you are and what you are interested or what are your intentions. So again, we can also mention this as metadata privacy.

Private rights will be whenever you take an action, like writing, or whenever you do any action on the chain, right? So things like voting, things like delegating, things like purchasing NFTs, tokens, things like transactions, things like defy, all of these will have your actions recorded forever. So you would want these actions to have some level of privacy so they cannot be linked back to your address or your intentions

or even like your persona. So I will call this like more on-chain privacy. And the third one or track that we have at least within PSC, we call Private Proving, which is like all these elements and libraries which allows you to kind of port data from Web 2 into the Web 3 world. So for example, if you have a digital driver license, if you have a bank account and you want to prove that you have more than

a certain amount of funds in your bank account, you can already prove this with technologies that, you know, we're developing and the Ethereum ecosystem at the whole is developing to put over these things. And a bunch of other kind of like necessary technical explorations, benchmarks and and efforts that we're trying to do to make these things usable for the day-to-day users. So not only these things will run in like big servers and big, you know, computers, but rather they need to run in your phone, in your browser, in your laptop, in normal day-to-day, you know, hardware, I would say. And I will say it is also very much in line what you see is with block

and it's about like removing trusted third parties and you can think of it almost like as a way to sort of scale society that if you have, as you have fewer dependencies, fewer things you have to, oh, do I trust this party or do you have a legal contract or something like that? It's more that you're trusting the math as opposed to humans and policies. And as you do that, and especially as you do business across multiple jurisdictions, it sort of simplifies things because as long as someone has proven that this works correctly and you trust that the code is secure, you can actually rely on it as a building block. And that's a major thing with, for example, private proving that you can have this data provenance. And instead of trusting some custodian, like some corporation to sort of deal with your KOC data or whatever, that easily gets hacked. We see that like every few months, that passport data.

that gets leaked or it gets hacked or all these things, right? So we're trying to remove that and basically have these building blocks where we can create proofs and use that sort of to build better systems essentially. And that's kind of similar to how internet works as well. Where you started everything was in clear text and HTTP. And it was like a fight, the only crypto wars in the 90s. And then eventually everyone was, oh, it's actually a great idea. We want HTTP because that's how you do payments online.

Otherwise, you can't buy something from Amazon. And just like natural, now people take it for granted. If you don't see the green marker for HGBS, that is. like now every browser enforces it, right? So it's just taken for granted. And I think we see similar things here with public blockchains and just creating things, being more secure and something that you don't have to think about.

It just kind of works under the hood. Out of curiosity, is that something that financial institutions are interested in because then all of a sudden they don't have this honeypot of data? Or is it something that they're a little bit wary of because then it gives them less control? It's a good question. I think it depends on the institution.

I think ultimately a lot of them, they have a very mature business, and they know how the business works and the value they provide. And that very much fits into these building blocks, because what they want, these are major, major institutions, and they want a secure system. They don't want to just rely on some random vendor or whatever. They don't want all the taxes to be public. For them, it's very important that if they issue a bond or trade it,

they don't want to leak all that information, and they want to have minimal trust assumptions on that. I think a lot of the way a lot of the way a lot of major users and companies think about is that they it's like a question of risk like what's the worst case scenario and who am I trusting and so on and if you can remove this kind of arbitrariness and have it be like okay this is actually proven that this works that's amazing for them right because they can create even bigger products that serves sort of their customers so I think it very much fits it's just a matter of like the trade of space looks a little bit different because they are operating in a regulatory environment so they have to buy it by all of that and and they want to integrate with your system systems, and they also have very high requirements when it comes to fruit and stuff like that. So this is like a different point in a trade-off space, I would say. Okay. I'll cover the remaining points that we're in the blog post.

One is private identities. Can you talk a little bit about, like, you know, what that is and, yeah, why it's important? So private identities is like, as we move more online, and we need to prove certain facts about ourselves, whether that be like our age or our residency or, you know, nationality, there has been even like massive push worldwide to try to get access to different, you know, websites in the States, in Europe. And although it might come from like the right, you know, intention from many of these regulators, it does possess like a huge risk, right?

Whenever you add, as we're talking about more KYC, like know your customer, like you are leaking your information everywhere and it's much easier to impersonate, it's much easier to know, like, you know, risky details about your, you know, you online. So this push, you, would be like, how can I make zero knowledge proofs in particular and prove specific facts about me without disclosing all this information, without me having to send the document, a picture on or everything, right? Whenever you check into a hotel, whenever you buy, I don't know, some airplane ticket, whenever you want to apply for a financial product, those are very risky actions that right now we have normalized, but at, you know, in an ideal state, we don't need to leak all

this information. We just leak, yes, I'm over 18. Yes, I'm not from a sanctioned country, or yes, whatever, right? So I will try to differentiate like the projects here like Greenfield and Brownfield, right? So Greenfield or Brownfield is like they're already existing, they're already identity, digital identity schemes that exist in countries. So for example, in the country of India, the scheme is called AdHard or the program. And there's like 1.3 billion users, you know, having very used to just use of their cards and verify it online. And that's not very private. So it's like how can we retrofit this systems and that zero knowledge proves and other type of technologies. So they can just prove online that they are a specific state or a specific vendor or whatnot

without leaking all the rest of the information. So there's like some efforts there. There's a project called Anon AdHar. There's projects for the in the country in Taiwan. There's projects in many different parts of locations. At the end, anything that is signed can be used as a building block. So you can like retrofit and add privacy to it. But then there's also like, Greenfield, which what we call is like governments who want to start from scratch or want to improve the current system. And a really great example that is the kingdom of Bhutan. And there's like a very forward-thinking, you know, kingdom that basically is trying to provide the most secure, most of sovereign digital identities to their citizens. And they built their digital identity system on top of

Ethereum. So they use Ethereum as a way of like trusted registry where, you know, you can know that things signed with this key match to, I don't know, official documents from the Kingdom of Bhutan, but then these identities can be ported over, can be carried on your personal phone and can generate proofs and can, you know, generate facts about it. Actually, Google also released their own stack a few months ago earlier this year, and I know Microsoft as well. So there's a trend, right? there's a real need about having strong privacy-preserving digital identity systems. And CK or zero-knowledge is like a great technology to build things, whether it's retrofitting or building from scratch. And I think Ethereum and blockchain in general are also a great thing as a trust register or as an anchor point for many of these use cases.

So how does the identity get connected to the person? because like what if my like provable identity gets hacked and then you know like a random person who's not me claims to be me but they have the proof like yeah how how can that right that's a great question and I would say those are all the signed decisions and part of like the schemes that you want to do so two things that are usually used or done in the domain is like one is like short-lived or single use proofs and the other one is revocation so if you get your power passport stole, you go to the embassy or you go to whatever police station and the same case with a digital identity and you, yeah, basically file a report. So very similarly, in the future,

even in the current space, you will do the same and you would have either a list of revocations, like a revocation list. So whenever the person who steal your identity wants to use it, that check will fail because now this is specific identity will appear, part of the revocation list. And there's just very clever tricks to how you can check that somebody, you know, has lost their passport, but without leaking all the information from that person. And the other one is like in revocation, there's also expiration dates. So documents also need to have some expiration dates because it's very common, right,

that over the span of your year of your life, you'll have to, you know, renew documents. So I don't think that would change that often, but those are the two techniques. in the short-lived proofs is like, I need to prove that you own like the original document. And there are ways how to like design systems so that I do a live-ness check. And I also know that, you know, the person who has presented this proof is actually the same person who is in the identity, who appears. Or that'd be with certain knowledge machine learning to kind of make a proof of the photo on your document matches with your face without leaking all this information to the servers and the companies. So there's a lot of research and maturity that is going on,

but already concrete use cases that can be used in production. And in addition to what Andy said, there's also this thing about, and we see this also with Ethereum and Bitcoin and all this public cryptocurrency that you have this key material, right, that you have to keep secure. And I think it started off kind of, it was a bit hard, and you had things like hardware wallet, but now the UX is improving more,

more and more. So for example, you can tie it to your device, so you use kind of face ID and pass keys and all of these things. And there's more things like multi-six and you can lock it for a period of time. And it's things like social key recovery where you can basically say if three out of my five friends or contacts, if they attest that this is me, I can get access. So I think what we're seeing is there's like a massive level up in terms of use experience for how to deal with this key material. because as we move into more and more digital world and more self-sovereignty, it's very important that you sort of keep this secure

but needs to be useful by anyone, not just like people who are very deep in technology. And it's in a way, way, better state than just a few years ago. And I think you can see this in various types of wallet efforts and so on. Okay, so another one listed in the blog post was privacy experience. I don't even know what that means, so can you explain that? Right. So historically, privacy has been,

very difficult topic to use for end user, for normal person in the street, like just trying to learn how to use these systems, how to keep your key secure, how to not leak information, and even just using some of the of many privacy protocols, it's a lot of hassle, right? It's a lot of like understanding the terminologies, understanding the tradeoffs. So privacy experience is this effort of trying to understand where are we in the current maturity line and what are things that we can do to increase the, the user experience without degrading the privacy and the security that we have in the current systems. So things that, like, analysis of like the flow of just usability, right?

Things like terminologies and language as what you were saying, like icons that in, you know, a few in small images can really depict like key concepts to make people aware about the different trade-offs and the actions that they're taking. So as much as like privacy is a technology problem, it's also like a social adoption problem or like opportunity, right? So we need to educate, we need to learn how to relate with these new technologies. So the human aspect is also like very important. Yeah. I think it's like it's partly like a literacy problem, right?

Right? Just like maybe have people from an older generation just like how to use internet, how to spot like fake news and like all of these kind of things that are like skills that you also need to acquire. And that's very much a part of it. But also, as I've said, very much about the use experience, like how do you make it easier for people to use? And traditionally it's been a bit of a disconnect because it's very hard to reason about privacy guarantees.

Like that is a fairly technical and a fairly new thing to think about. So you have people are extremely technical and they talk a language, like maybe hopefully not too much for your listeners with all this name dropping we're doing, but there's like a certain language that people, how people talk about these things and it's disconnected from how normal people live their lives. And you're trying to sort of make that connection. Part of that is definitely education. Part of that is like metaphors or like visual indicators.

And I guess ultimately having empathy for end users and making systems that work better for them. And so now we get to the Institutional Privacy Task Force, which was also listed. And when I saw that, I was like, this one, like just even the word, it sounds different from the other ones. And I realize, like, for in my head,

it just sounds like there's probably a whole component that involves like regulation and compliance. So it's like probably quite a different, yeah, it's like focus area from the others. So can you explain? Yeah, sure. It's different, absolutely. I would say the way you can think about regulation and compliance on it, it's more like a different constraint, right? So you use the same kind of building blocks and same primitives that so PCM and other people in the ecosystem has been put in for a long time.

And the situation is evolving, right? Like a few years ago, it was really the Wild West and it was no regulation whatsoever. and it was really hard for established institutions that are operating in a specific jurisdiction to sort of even start to think about these things. But what we're seeing now is that more and more there are some regulatory clarity and some attempts to make sort of these legislative efforts and regulation fit better with the sort of crypto-native side of things. So we're a much better spot now than we were a few years ago. There's definitely like a lot of work to be done on the policy side and so on. So it's definitely not.

work in progress, right? But we're speaking on from things like stable coins and so on. Now there's at least some kind of regulatory clarity. And that is just like another type of requirement. And I think you can accommodate both, especially with Ethereum being a sort of credibly neutral base layer. You have both these sort of more extreme cyberpunk hardcore use kits on top, but also these kind of more regulatory and compliance kind of solutions.

And they basically coexist. And because the technology is so flexible, in terms of synodontroofs and so on. You have way more a fordosis now than you had a few years ago, so you can actually design the systems to accommodate these more complex workflows where, for example, auditors need access, and you want to make sure that you meet all this of regulatory requirements that institutions operate under.

All right. So the last one listed as an area that you guys were working on as part of this initiative was Kohaku. Explain what that is. Right. So Kohaku is this good effort to try to bring privacy to wallets and make it much easier for wallets to adopt. So it's like a reference implementation and integration about many different privacy protocols that exist currently on the Ethereum ecosystem into an SDK. So like a software developer kit that other developers building wallets or building other type of protocols can just take and very easily integrated.

And I think this is great because it just lowers the cost of adoption for privacy technologies for all these different providers. and companies and just like it's a good way to distribute technology. But at the same time, it's like a good way to set a standards, set a reference, set up like a goal about what would be the perfect, most secure, you know, more private, no, yeah, intention or effort into like into the wallet privacy. So the intention would not be to, for the Ethereum Foundation to run, you know, a wallet and try to get end users and try to, you know, get adoption because that's much rather something that we would like the ecosystem to run and do, you know,

business with, but it is a good effort to push into the right direction and implement primitives, like the ones I was mentioning, and even like the rest of the ecosystem have like a point of, you know, connection and adding and help push standards. So it makes it easier, a lot easier for builders and to, you know, take these technologies and for users to then look more quickly adopt all of these technologies. And I would add to that, like, in this web 2 world, like developing a product, it's like difficult and so on, and then you add this kind of, you know, blockchain and smart contrast and that component.

It's like a specific set of skills, right? And I think the same thing goes for privacy tools. Like, it is a very different world, like how you write synonymous-proof circuits and so on and how do you integrate that into a product. It's not trivial. It requires specific expertise. And if you have a wallet and you're trying to serve your users

and provide some value, that is kind of scary because it's not always easy to do that. I think what Coaggett is also doing is showing how you can do it, it's showing examples of it. And I think another thing is that there's all this amazing resources and open source products and so on that exist in the space, but it's not always obvious to people. Like how do you put them together and what do they actually provide in terms of the use experience? And what Chouhagas do is taking all of these primitives that have been developed for the last few years and putting them all together into the package.

People can see visually how this is actually fit together. And I think that's very exciting for end users as well as wallet developers, because you can see, oh, this is how you combine them. And actually, I think we see some of the things, but in a completely different domain when it comes to institutions where a theorem ecosystem is such a broad, it's like a jungle, there's so much going on, right? And they don't know how to make sense of it all and like, how do you put these things together?

So that's also what we're trying to help with in this mapping effort and showing here's how you combine all these things. And here's actually this provides a superior experience to whatever you're considering. So, yeah. So I want to zoom out a little bit and look at privacy. in crypto generally. And I was kind of curious, like, you know, as we mentioned in the beginning of the show, things like Zcash suddenly just, you know, everybody, you know, it's like all the coins

are going down, but Zcash. Zcash is not going down. Like, you know, we've seen that the last few weeks. And I don't know, like, you know, traditionally, I think, like most people have bought Ethereum is kind of competitive with these other all layer ones where, you know, it's like this whole smart contract competition. But do you view something as Zcash? like Zcash is just fundamentally different because it's like more like Bitcoin, it's more focused on payments,

or do you think that Ethereum is also competing with that? Or do you feel like Ethereum's kind of creating something brand new where it's like bringing privacy to smart contracts and there's like many more applications or just like, how do you think about, you know, what you're seeing in terms of other privacy efforts in crypto and where Ethereum fits in with that? So I guess this brief on CECS specifically. I think that they are very, CECS and Ethereum are very much philosophically aligned. and the communities, especially this privacy part of the Ethereum community. And it's like a lot of collaboration in terms of actual code and research and so on.

So I think they are sort of seen as like very friendly to each other. And I think the space of like it's so big that I don't think it's not competing. There's sort of if anything complementary. And Sika specifically is focusing on payments and so on, whereas Ethereum, first of all, the base layer is still transparent and so on. So a lot of private solutions are more on top. But Ethereum is obviously home to defy and stable coins and all of these other types of applications. So it's actually somewhat of a different niche.

But even to the extent that there are payment protocols on top of Ethereum, I think it's, you know, it's, they might use similar technology, but I don't think they are like actively competing because this space is so large. Yeah. That's, I guess, how I would frame it. Yeah. And I'm going back to you mentioned, so I would say also there's definitely been some movement. in the markets recently. I would say that when you look at something like CECAS,

I think fundamentally that comes from like very strong R&D and making actually real progress just the last year and so. And I believe you had them on the show recently. And I think that's sort of the origin of it. And then everything else happens after. Yeah. And also like it's well deserved, right? It's like a good team, a good ecosystem, like very, you know, value line and just like very

strong technically and they have pioneered, Tier Knowledge proves a lot of languages to write all these things. But yeah, fundamentally it just took different paths. So I saw Sean Bowie also showing like the philosophy that they were taking. It's like at privacy, then add usability and then scale it. So right now they are in the part of scaling and that is where their new papers, new proposal for upgrades go through. Whereas Ethereum has much more focus on like decentralization and then usability and all

all these rich history of explorations and new use cases that started on Ethereum. And in the past couple of years, I've also been focusing on scaling. So I will say right now, and now we're, like, super pushing hard on privacy. So I would say, like, there's a lot of things that we can learn from the Seekash ecosystem. There's a lot of things that now they will want to learn from us as well, how do they scale and how do they bring usability from, like, the Layer 2-centric roadmaps to, like, other, like, more core engineering, distributed engineering, like, skill sets. So, yeah, I would say, like, it's great.

And as Oscar was saying, there's like, this is a big market and we're not, like, against each other, but rather trying to capture, you know, the traditional technology web two world. Is how we try to frame it. Yeah. I would say symbiosis. Yeah. Yeah. Okay.

It was very an Ethereum-like answer, you know, like Kumbaya. Yeah. Well, so I also, of course, wanted to ask because Ethereum itself has had many privacy efforts, you know, whether it's like different teams that work like in the Ethereum ecosystem. Right. So I wondered what, you know, the EF's new focus on privacy means for these more longstanding privacy apps like tornado cache or even some of these chains. Like I'm sure you guys heard about the new ignition chain on Aztec. You know, there's starknet.

Like there's, you know, privacy, it's not like it doesn't already exist in Ethereum. So, you know, what does the new focus in the EF mean for these other efforts? Right. So I'll start by saying that it's just, you know, a lot of collaboration, a lot of symbolizing. is like we do have direct lines of communication with all of these teams in the Ethereum ecosystem because we want to help them and we want to see what is what they're thinking, what is progress, what direction we're all taking and just experiment with different primitives. There I do see though, which may be a question underneath is like how does, if Ethereum layer

one becomes private, what happens with, you know, privacy focus or layer twos? And what I always say is like layer twos continues to be like key for the Ethereum scaling roadmap and for the Ethereum ecosystem. them and Lyrtuce would always have an advantage in terms of innovation just because, like, they're smaller, like, more, you know, concentrated teams. They kind of can't just like stop and, you know, start the new, even from scratch, right, architecture, that greenfield advantage that they have. So I love that part.

And I love seeing, you know, ASTIC, Miden, and Stark and many others doing like privacy push either complete architecture to be privacy focused or within a generalized architecture, try to add privacy to their stack. So I think that's great in general. And Ethereum also needs that on the layer one, right? Because there's like institutions and like users, real humans that we also need to have some levels of privacy. So in general, I will say it's a lot of collaboration. It does mean that they have a partner that we can like learn more about primitives and libraries and SDKs and programming languages

that we can like accelerate the formal verification, accelerate, you know, the maturity of all these technologies. So just like accelerate the adoption and use cases in Ethereum layer one. I need layer 2 in general. And I would say in general, the EF tends to take a bone of a subtractive approach. So if the ecosystem is solving a problem, there's no need for us to meddle with it. We're trying to work on the things that are overlooked,

or we see there's a need for, and maybe there's not enough incentives for other people to work on it, and we kind of act more as a coordinator and push, have targeted R&D towards areas that are maybe not, like, a little bit overlooked and so on. And from institutional point of view, I do think it's like,

I love appetite for, like, very customized, like, if it's like having a drone L2 or whatnot, and that's kind of also how the film roadmap is shaping up in terms of allowing these different kind of app L2s or whatnot. If I can give an example, there are like 20 something, 30-something teams building zero knowledge virtual machines, SKVMs, and in a way they'll claim that theirs are the best

and the fastest or the most scalable. So efforts like just benchmarking these CQVMs makes a lot of sense. Now, there have been historically a lot of benchmarking for scaling, like how many transactions they can do per second, how big the proofs or how many Ethereum blocks, how fast they can be proven. But now we're also doing benchmarking for how can they run on your phone, like client-side-proving.

So doing these efforts in tandem with all the R&D and experimentation and innovation that all these things are bringing, really helps accelerate the development of technologies and eventually, you know, the adoption for normal users as well. Okay, so I want to turn back to the tournament. natal cash thing because obviously, I mean, it was huge for Ethereum when everything happened with OFAC and, you know, it was like right before proof of stake. And then you saw like what was happening where the stake was like by, I forget, it was like more than half of the transactions

were being censored for the OFAC thing. And so I just was wondering, you know, like now, obviously it's a few years later, things have changed. But, you know, what is your current view on like, you know, what you kind of need to keep in mind when you're building these privacy, you know, efforts like from a regulatory perspective, or I don't know if you've been engaging with different regulators and you kind of already have a sense of like how they're approaching it or what they think about it. But, you know, from that perspective, what are you kind of keeping in mind as you build?

So going back to, I remember when that whole thing was happening, at the time I was running an R&D lab, and we had research working on similar types of protocol. And it had definitely had a shilling effect. like people were afraid of working on certain technology. And I think this is just how whenever you have a disruptive technology, you're just always going to be power struggles and figuring out how this is work and it's code law and all of these things.

And it takes a while to shake out. And we saw this in the 90s with the first Cryptoborce. And we saw this with Tunaicash. And we also, obviously, a lot of things are ongoing, but there's at least been some progress there on the regulatory side. So I think that would kind of always be the case whenever you have some kind of really disruptive technology, which Ethereum and public functions are.

I would say in general, the way E.F thinks about it is that we are more, I guess, on the R&D side of things. We're not necessarily running things in production. That's not our role. We're trying to facilitate and enable that, but that's usually sort of different products that would take different types of approaches.

I would say in general, the ecosystem as a whole has, I guess, learned a little bit from it, and there's been definitely various conversations. with regulators that individual teams have had to sort of understand how they can design your systems better. But obviously, people will also choose different points here and how adversarial they want to be and so on. And that's just part of Ethereum being a incredibly neutral infrastructure and then people making different choices on top of it. So just to add to that, there is a spectrum, right? And from one side is like the most compliant, the most like government, the most like, you know, practical or responsible privacy.

And on the other side, it's like the most cypherpunk, the most permission. And in a permissionless layer, anybody can build anything at the end of the day. So as Oscar was saying, both will coexist. I guess it's just like recognizing that there will always be these power struggles, these different differences of interpretation. You know, what was illegal at a time from the states for a specific government or administration won't be for the next one and it's not for like different parts of people in the world who also wants to get privacy.

So again, like the strategy will be to just continue to be the neutral, credible, neutral, you know, layer for interoperability and for, you know, teams, governments, corporations just to be able to transact more freely. Okay. And one last thing I just want to ask about was, and this is like just from a purely practical perspective. Like I know Zcash and I think Manero, they had like the private viewing keys where you could give a party, like, you know, the ability to look at your transaction. So is that like a common feature that you guys are thinking about building in? Yeah, I would say that's definitely one design you have. And I think it depends that we're talking institutions. There are different requirements depending on what regulatory or four you're talking about.

So that's definitely one thing that can be chosen. Another thing is sort of if you want to have some of audit log and other is if you need some kind of live access. So I would say it depends a bit on the specific jurisdiction. Yeah. So I think there's different, different design choices you can make. And viewing keys, I guess is one example. And I know ASSEC have also different ways of doing this. And that's like one example of.

maybe a slightly richer performance than what used to exist. And I guess that's partially in terms of responding to sort of demand from the world. If I were to add more specific examples, like viewing keys might not prevent, you know, someone using a privacy protocol. It will be after the fact. And that is what regulators usually are used to, or auditors, right? But there are things that can prevent before it, for example, an allow or a denial list, like these addresses because they have been marked as possible hackers.

about this specific protocol cannot use our now part of the list, and therefore they cannot use this privacy protocol. And those are like self-regulation mechanisms that the ecosystem has found that I think are very much more appealing to, or could be more appealing to regulators and jurisdictions, right? So there are other aspects like, you know, zero knowledge KYCs, like if you have done KWC with a specific institution, how can you take this over and just allow people who have, you know, KYC before?

So there are things there. There are things like KYTs or Know Your Transaction, which is like a risk score depending on specific models. So there's just like a very rich design space about when you're thinking about, yeah, just compliance. It just depends on what rich jurisdiction you're trying to be complied with and what are the needs, the requirements. And there's like, it's very expressive technology.

There are many ways in which we can, you know, build that. So can you give me a sense of the timeline here? Like when do you think all of these things? might be implemented? What, you know, which, what do you think will be implemented first? How quickly might we see these things being implemented? Yeah. Right. So I'll say a statement, like a prediction. I'll say like in six to 12 months, we're going to say Ethereum has solved the private transactions in the ecosystem. There are just so many teams doing all these tradeouts. And I have no doubt that we have solved these. And when you say solved, you mean like you have the

technological like way of doing it, but maybe. the implementation hasn't happened or like how the implementation the production is already it's only the on the adoption phase right okay and this is like for layer one transaction one transaction that is my prediction wow yeah i i'm sure like next year we can talk we should make a prediction market for it let's do it let's start it like i'm very convinced that this this will happen it's just like seeing the strength the technologies all the different approaches there's no doubt in my mind in six months 12 months and like even like been could and you know into an upgrade and it's okay wow yeah yeah yeah

I don't know if that wall is so many things. I would also emphasize that a lot of things are already in production, right? Yeah. So, like, for example, railgun they have, I think, $4 billion TVL or something like that. It's like private defy. So that already exists, right? And you have similar things like CKID that are used, I think, Aztec used it, and there's a sort of recent effort they're doing.

So that's already live. And also CKTLS is used for on and off ramps in a permissionless fashion. So it's like taking always already live, right? It's just a matter of, you know, tweaking and growing in the market and so on. In terms of institutions, like there's already like a lot of institutions building on top of Ethereum. There's, I think, things like private stable coins is definitely a hot topic. And I think we'll see more and more of that over the next six or 12 months. And then it's just a matter of like products facing it out in terms of supply products.

And like it's like larger size and then more deployments. So I think it would be like a gradual shift. But I think there's a very much big appetite for it. And just with the regular clarity, I think there's like a lot of people, parties that are very excited as of, you know, be early on it. Okay, so I need to understand this. Once this all gets implemented, then what is it going to look like? Because, you know, right now we're so used to, like, going on Defi Lama and looking at

TBL and we can, you know, look at like an ICU and we can kind of pick out, like, different addresses. And, you know, there's, like, those little, like, bubble maps and, like, all that time. But, like, what, do you, do you think there will just be a mix of public and private transactions or do you think everything will kind of end up going public or, like, like, what does that world look like? Because for me as a reporter, I'm like, oh, shoot, like, am I going to be able to look things up that I want to look up? Or, like, yeah.

So I'd love to hear what your vision is for, like, yeah, what that will look like when it's all finally implemented. Right. I'll definitely say that they will coexist. They'll be private and public transactions. There will be things where we want the public property, right? We want, like, auditing and traceability and, like, I don't know, ensuring, like, things happen. And it makes sense in that case. If we think, like, other examples, like in C-Cash, I can remember the exact numbers,

but I think, like, 25% or 30 around that is, like, private transactions. So it's like, it's not going to happen overnight, and there are reasons why you will want to have that flexibility. But, like, I can't understand why anybody would choose a public one. Like, once it gets implemented, I'm like, oh, I'll make everything private. Right. Yeah. I have an example. Yeah, I think it would be a gradual shift, right?

And like looking at, for example, institutions, a lot of the reasons they want to move to Ethereum in terms of access to liquidity, and in fact that it's like a chain with 10 years of uptime, and so it's kind of a, they can kind of trust it. It's not going to go away tomorrow. Sensory persistence and being like a credible neutral settlement layer.

And like if you have defaic system, you want to access to liquidity, there might actually be reasons that, you know, certain things are public and so on, and, and, you know, You might mint, for example, a token on L1 as a kind of public thing, and we're going to have access to all this rich defy-eat ecosystem. And certain foreforses might take longer.

So, for example, you can do maybe private payments, but some kind of private trade thing might take longer because it requires like if it's seed to bring this full fruition. So that would be like a stepwise sort of, I don't want to say migration path, but stepwise use of like more rich affordances. But to give an example, maybe a country does or a local government does want all their citizens to be able to audit how they spend the money and wanting to make it private. So like anybody in the world can see like this was sent to this transaction and this was,

this was, you know, the budget that they received and all of that. So there are like real reasons why someone would just want to keep certain things public. Okay. Similarly to how we do, you know, in social media, right? Some things would just like send over DMs. Some things will make a post for everybody to see. Right. That's true. Okay. Well, is there anything I do? I didn't ask you guys that you would want to mention. I think that comes to anything? Maybe just like final thoughts.

Yeah, go ahead. Okay. So I'll say the privacy ecosystem on Ethereum is very strong. They're like hundreds, like over 200, 300, 300 teams building privacy on Ethereum ecosystem in all layers of the stack. So it's like a very rich, you know, push that is happening right now, very organic. It's not a reaction. It's been like boring for years and there's like a long tradition of it. And because of the programmability, I think we're going to be able to do everything that we can imagine, like, other blockchains have achieved.

It might take longer. It's true that the current layers are all public, but that does not mean that we can achieve the same levels of properties or use cases that other blockchings have achieved. So I'm very bullish on Ethereum, very bullish on its privacy ecosystem, and it's just right now a matter of, like, executing. There are still long-term research problems that would just, like, make things more expressive, more scalable, perhaps. perhaps different affordances. And there's continues to be very rich investment in those areas by the whole ecosystem, new companies, and even the Ethereum Foundation. But yeah, there's no doubt that we're executing and that there's already production-grade

projects and alternatives that you can use. And there's just going to be an explosion of even more coming over. I would, yeah, to add and I could add, like, I think two things. Like one thing is like, just as, you know, when you have public blockchains that came and before the internet and credit card payments, It enables these rich set of use cases and so on that we couldn't even think about before. And when we talk about Cynos proofs or MPC and or FHC, all of these types of technologies, you can think of them like programmable cryptography.

And it's a similar thing where the people in this space have been deep in for many years, the way they think about trust and how to build this type of new systems is very different from how someone, for example, a software internet and Google would think about it. And it just enables completely new types of, new ways of interacting. attracting and creating proofs about things and composing technologies. And I think we'll see that. That will take a long time, not just in terms of technological readiness and so on, but just in terms of mental models and understanding what this technology allows.

And I think that will play out over the next decade, just because the rest of the world need to catch up. That's one thing. The other thing I would say is that on the institutional front, you know, institutions want to move on chain and they need privacy. So if you're listeners are representing institution or maybe a vendor working in the space, I think that's like, we wait to come talk to us because we want to help. And we are trying to help institutions move on chain and making sure the private solutions are addressed. So, yeah.

Yeah. Honestly, I could imagine if I were an institution that, like, in my head, it would make sense to use Ethereum. Because it's like, it's not only the uptime, but it's also like, if one of my competitors is working on a chain, then, you know what I mean? It's like, I'm not already directly. competitive with Ethereum. So it sort of feels like this is like a neutral ground. Yes, exactly.

Yeah. So I could see it working out well for your efforts. And liquidity, right? That is also like a very good network effect. And just mind sure and EVM, you know, standards. Tooling. Yeah, developers and just generally infrastructure. So I think a lot of people there who understand technology are like, well, we want to use

Ethereum, but this privacy thing we're not sure about. So as long as there's ways. to address that, I think it's definitely the right choice. Yeah. All right. Well, this was super fun. Thank you both so much for coming on the show. Thank you so much. Thank you so much. It's a pleasure. Unchained is produced by Laura Shin with help from Matt Pilchard, Juan Oranovich, Margaret Curia, and Pam Majumdar. Thanks for listening.