Author: Cookie, Rhythm

Yesterday, Solana's official Twitter account posted a thread introducing 12 privacy-related projects within its ecosystem, covering categories such as encrypted computing, privacy infrastructure, payments and wallets, transactions, prediction markets, and smart protection.

Encryption computation

Arcium

On March 27, the encrypted computing network Arcium announced the completion of its angel round of financing, with investors spanning multiple sectors, including some community fundraising through Echo. The total funding has now reached $11 million. Participants included Jupiter co-founder Meow, MegaETH founding team member namik, and Jupiter co-founder Siong.

Arcium started as Elusiv, a privacy protocol on Solana, and later evolved into a broader privacy computing platform. Using MPC and ZKP technologies, it allows computation on encrypted data without exposing the data content.

In an Arcium network, MXEs (Multi-Party Execution Environments) are responsible for securely executing computational tasks. Users can configure the encryption protocols used for each MXE individually and on demand. arxOS is the distributed execution engine within the Arcium network, responsible for coordinating computation and providing support for Arx nodes and clusters. Each node (similar to a core in a computer) provides computing resources to execute tasks defined by the MXE.

A notable highlight is Arcium's provision of two different MPC protocol backend implementations. One, called "Cerberus," operates under a "dishonest majority" trust model, featuring cheating detection and identifiable termination mechanisms. This means that privacy is guaranteed as long as at least one node is honest. The system can also identify dishonest nodes, remove them, and penalize them. This contrasts sharply with most protocols that require an "honest majority" (i.e., more than 51% of nodes are honest).

Another type, called "Manticore," is designed specifically for AI scenarios. While its security assumptions are not as strong as Cerberus', it is suitable for environments with access control, such as AI training in trusted environments.

Umbra, another privacy-related project on Solana, enables private on-chain transfers through the Arcium network. Umbra will be introduced later.

Although Arcium released its token economics back in March and conducted a 2% token sale on CoinList, the project has not yet achieved TGE.

Privacy infrastructure

MagicBlock

On April 25th, MagicBlock, an on-chain game engine, completed a $7.5 million seed round of financing, bringing its total funding to $10.5 million. This round was led by Faction, with participation from Maven11, Mechanism Capital, Robot Ventures, Delphi Ventures, Equilibrium, and Pivot Global, as well as angel investors including Solana co-founder Toly, Helius Labs CEO Mert, and former Backpack co-founder Tristan Yver.

While initially focusing on an on-chain game engine, MagicBlock launched Ephemeral Rollup, a scaling solution protected by a Trusted Execution Environment (TEE), in September of this year. According to them, this is the first privacy infrastructure built on a Trusted Execution Environment (TEE) and natively supported by Solana.

Traditional privacy solutions require significant cryptographic overhead, are slow to execute, and cumbersome to integrate. MagicBlock takes a pragmatic approach: Just-In-Time Ephemeral Rollup aggregates standard Solana transactions running within an Intel TDX secure enclosure, creating a hardware-verified "black box" where sensitive computations are protected. Not only is it auditable, but it can also be deployed in production with just a few lines of code. It can be used to build confidential order books and dark pools, regulatory-compliant DeFi protocols with built-in privacy controls, secure and auditable payment channels, and privacy-critical consumer applications and games.

Overall, this is infrastructure designed to build on-chain privacy features and even applications. Its advantages include speed, ease of integration with Solana developers, and high access control. However, from this perspective, since it's infrastructure that has almost no connection to retail investors, it's hard to say whether they will actually issue their own token in the future.

Payment and Wallet

Umbra

From October 6th to 8th, Umbra conducted an ICO on MetaDAO with a minimum fundraising target of $750,000. In the end, approximately $155 million was raised, resulting in an oversubscription rate of 20,659%.

As mentioned earlier, this project enables private on-chain transfers on the Solana blockchain via the Arcium network. Umbra can conceal the flow of funds on the blockchain and provides a user-voluntary auditing function, allowing users to disclose their transaction history to third parties for compliance or auditing purposes.

The foundation of Umbra's anonymity layer is the "shielding pool," a smart contract that holds a large number of mixed tokens from numerous different users. A shielding pool is like a public vault where everyone deposits their tokens. Once tokens enter the vault and are mixed with everyone else's tokens, it becomes impossible to determine the specific ownership of any particular token by calculation. As more users and assets flow into the pool, the privacy protection for each user also increases.

Depositors deposit their tokens into a shielded pool, and the protocol obtains and encrypts the deposit details (such as the amount and the recipient's Umbra address). On-chain, it's only visible that the deposit originated from a Solana address, but not its final destination.

The recipient will generate a zero-knowledge proof, which, after verification by the Umbra contract, will transfer the funds to the recipient's Umbra address. Gas fees incurred during the recipient's asset withdrawal process are directly deducted from the received funds; therefore, the recipient's Umbra address does not require depositing SOL to complete the withdrawal, ensuring complete privacy throughout the process.

encrypt.trade

Privacy-focused DeFi on Solana, supporting privacy transfers and swaps. A winning project from the Colosseum hackathon, backed by Alliance.

When a user performs a swap on this platform, they are first asked to wrap their tokens. The tokens are encrypted using the ElGamal algorithm. Only the wrapped asset type is visible on the blockchain; the actual encrypted data is stored off-chain.

In other words, the packaged token only serves as a "pointer" on the blockchain, allowing on-chain applications (such as Jupiter) to know what kind of coin it is. The specific transaction amount and movement are calculated within a secure environment of a TEE (Transaction Execution Environment) architecture. After calculation, the on-chain data is re-encrypted and updated, and the corresponding on-chain application's algorithm is used to execute the appropriate operations.

The result of this approach is that, unlike traditional DEXs, encrypt.trade's Swap does not explicitly broadcast transaction data on-chain. Instead, it only shows changes in the state of the packaged assets, but not the transaction amount, the trading parties, or even whether the transaction actually occurred.

Hush

The product has not yet been officially released. According to its official Twitter account, it is a privacy-first Solana wallet that will offer SOL anonymity, one-time addresses, and privacy transaction features. It also supports wallet creation for dApps and has a built-in ZEC bridge.

Privacy Cash

The current version has limited functionality, only supporting private SOL transfers. Future updates will support private SPL token transfers and Swap functionality.

The depositor stores SOL in a privacy pool, which generates a "credential" added to the Merkle tree. The recipient verifies the credentials using zero-knowledge proofs and can then withdraw the corresponding funds from any receiving address.

trade

Vanish

This is another winning project from the Colosseum hackathon, and it has secured $1 million in pre-seed funding led by Colosseum, with participation from Solana Ventures and Pivot Global.

Vanish utilizes smart transaction routing technology to maintain transaction privacy through protected liquidity sources. The documentation doesn't provide much technical detail; the project prioritizes compliance and privacy, emphasizing its anti-dark money policy and reassuring users that they don't need to worry.

UniFi Labs

The product hasn't been released yet; the focus is on privacy perpetual contracts.

Intelligent protection

Darklake

This project aims to achieve many things, describing itself as a "zero-knowledge proof privacy layer." However, they don't intend to create a complete privacy system or blockchain; instead, they plan to leverage zero-knowledge proofs to directly develop practical privacy applications on Solana.

Currently, the "blind slippage pool," also known as zk-AMM, is already online. The blind slippage pool adds a cryptographic commitment layer to Automated Market Makers (AMMs), making slippage data invisible to searchers but verifiable after the transaction. Specifically, after a user submits a Swap transaction, the system generates a hash value and a unique encrypted value based on the transaction, submitting both along with the transaction information. Darklake's proof generator generates a Groth16 proof indicating that the calculated result equals or exceeds the slippage range. If the proof is valid, the transaction is settled; otherwise, the transaction is rolled back, and funds are refunded.

They also plan to develop privacy-preserving versions of perpetual contracts and launch tokens. As for why Solana categorizes this project as smart protection, I think it's because it offers a comprehensive suite of features, and also because they've integrated Arcium's technology stack to handle multi-party privacy state coordination after transactions are completed.

Loyal

It was also a project that completed its ICO on MetaDAO, with a minimum fundraising target of $500,000 and ultimately attracted approximately $75.9 million in participation, resulting in an oversubscription of 15,180%.

Loyal is an open-source, decentralized, censorship-resistant, and auditable smart protocol powered by MagicBlock and Arcium. The simplest summary of this project might be that they aim to create an on-chain AI that protects user data privacy, starting with cryptographic transaction processing and gradually refining it to the point where it can assist with daily life and work tasks, much like current AI systems on the market.

Prediction Market

Melee and Pythia

Both utilize Arcium technology, and generally speaking, there's not much to elaborate on the technical aspects. They both add encryption to the order book of the prediction market, achieving the effect of a dark pool. Whether this will be what players need as prediction markets develop to a certain stage remains to be seen.