Blockchains were originally designed to be transparent, with every wallet and transaction on public display. Many supporters see this ‘trustlessness’ as a strength, but there are some obvious drawbacks, such as the security risk of having all of your financial activity available on-chain.
We can see this in the rates of illicit activity around blockchain, with bad actors accounting for $39.6bn of transaction volume in 2022.
We are also seeing a growing tactic of frontrunning for personal gain, where users with the technical skills to do so, reorder trades before they are committed to a block. By doing this they can ensure their own trades are always profitable.
These are just two examples of why transparency is often seen as a bug, and it’s also why the search for blockchain privacy is heating up. We are now seeing a flurry of innovation within the ecosystem to push for privacy solutions, arguably the last frontier for blockchain.
Blockchain Privacy Solutions
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