In a groundbreaking development, several crypto startups are channeling their efforts into creating the first privacy-focused Ethereum Layer 2 (L2) solutions, as reported by Blockworks. This initiative emerges in response to the transparency of transactions and smart contract operations on Ethereum, which could potentially reveal vulnerabilities to malevolent entities. These privacy solutions are poised to empower decentralized application (dapp) developers to tackle these challenges without compromising on security.
Among the pioneers, Aztec stands out with its privacy layer for Ethereum, utilizing zkSNARKs and the Noir programming language for secure private transfers. This innovative approach amalgamates private and public executions in a singular zk rollup, with the encryption of transactions being managed by users’ devices. Aztec’s vision focuses on facilitating engineers to craft private smart contracts, simplifying the complex mathematical aspects of zk proofs. They have recently introduced Aztec Sandbox, a novel testing environment, and are gearing up for a testnet launch in the upcoming year.
Fhenix, another key player, is set to integrate fully homomorphic encryption (FHE) into smart contracts. Contrasting with other startups that leverage zero-knowledge technology, Fhenix’s FHE encryption conducts computations directly on encrypted data while keeping it on-chain. A developer testnet was initiated in July, with ambitious plans for a comprehensive testnet launch of its FHE rollup in early 2024.
COTI, a privacy-focused L2 solution building on Ethereum, aims to employ Garbled Circuits for facilitating private transactions. These circuits are designed to enable two parties to process information, irrespective of mutual trust levels. COTI plans to unveil a developer testnet V2 in the second quarter of 2024, followed by a mainnet launch .
Disclaimer: Please note that the information provided in this article is based on the referenced research articles. It is essential to conduct further research and analysis before making any investment decisions. The cryptocurrency market is highly volatile, and investors should exercise caution and consult with financial professionals before engaging in cryptocurrency trading or investment activities.