Encoins, Cardano’s first privacy protocol, is scheduled to launch on the mainnet on November 30, according to an announcement on Friday.
Encoins is designed to improve the privacy and security features of transactions on the popular blockchain, a move that shows the growing demand for confidentiality in digital currency transactions.
The technical specifications of the protocol.
The upcoming Encoins protocol on the Cardano blockchain introduces a mechanism for private transactions using zero-knowledge proofs, a key cryptographic tool.
This protocol allows users to deposit Cardano’s native cryptocurrency, ADA, to mint ENCOINS, a unique form of NFT that represents encrypted value.
These ENCOINS can then be converted back to ADA, but only by the user with the corresponding minting key, ensuring privacy in transactions.
Additionally, the protocol employs a decentralized relay node system, where ENCS token holders can stake their tokens to support network operations and earn a share of transaction fees. In this way, they can contribute to the security and efficiency of the network.
More demand for privacy
The crypto space is already occupied by other privacy-focused projects, such as Zcash and Monero, which also use zero-knowledge proofs to keep transactions private.
This technology is essential to allow authentication of transaction details while preserving the confidentiality of the data involved.
Last November, Input Output, the developer arm of Cardano, launched a new privacy-focused blockchain called Midnight.
According to Friday’s announcement, the Encoins team is also “exploring the possibility” of building on top of Midnight.
