Two major blockchain projects have launched new privacy features this week. StarkWare introduced a “compliance-ready” framework called STRK20 for Starknet, while Sui began a public beta for confidential transfers. Both systems allow users to conceal transaction data while incorporating mechanisms for authorized auditing and disclosure, reflecting a broader industry shift toward regulated privacy.
StarkWare unveiled the STRK20 privacy framework for ERC-20 tokens on Starknet. The system allows users to shield balances and transaction data while providing for potential disclosure. “Compliance-ready” does not mean STRK20 itself determines legal compliance or guarantees regulatory approval, according to co-founder Eli Ben-Sasson.
He described the framework as using a risk-based model where privacy is conditional. Screening is applied at entry into the shielded pool, and viewing-key-based disclosure is available under lawful request.
Separately, Sui launched a public beta for confidential transfers. This feature conceals transaction amounts but permits authorized parties to access information for auditing or compliance.
These launches indicate a move in crypto privacy away from complete anonymity. The trend is toward models favored by institutions that incorporate audit and disclosure mechanisms.
The shift comes as other privacy-focused projects address oversight questions. Zama recently said it would accelerate its compliance roadmap after a court-ordered freeze of about $12.5 million in its confidential USDC wrapper was later lifted. The project highlighted its disclosure mechanisms for encrypted transactions.
Scrutiny of privacy protocols also intensified after Zcash disclosed a bug that raised concerns about potential counterfeit token creation. Developers said the vulnerability was addressed through an emergency network upgrade in early June with no confirmed exploitation. However, the nature of shielded pools makes fully reconstructing transaction history after a vulnerability difficult.
