At the Zama CoFHE Shop, the Stellar Development Foundation and Predicate discussed the emerging balance between privacy, compliance, and auditability on blockchains. SDF's Chief Product Officer Tomer argued that there is no one-size-fits-all approach to privacy. Instead, Stellar is building the cryptographic primitives so developers can layer whatever privacy solutions their use cases require. Predicate's head of business development emphasized that privacy and compliance evolve together, not sequentially. Key blockers to adoption include the lack of user-friendly products and regulatory uncertainty. SDF announced Protocol 25 X-Ray, bringing cryptographic building blocks (pairing-friendly elliptic curves, Poseidon hash functions) to Stellar, along with integrations for Noir, a zero-knowledge DSL, and RISC-Zero verifiers. SDF is collaborating with Nethermind on Stellar Private Payments, a privacy-preserving protocol based on Privacy Pools research, and shipping a confidential tokens implementation. The consensus: the cryptographic infrastructure is ready; the market needs better products and regulatory clarity.
At the Zama CoFHE Shop, Stellar Development Foundation and Predicate examined how privacy and compliance can coexist on blockchains. Tomer, SDF's Chief Product Officer, rejected the idea of universal privacy standards, arguing instead that Stellar should build cryptographic primitives enabling developers to choose privacy solutions tailored to their specific jurisdictions and use cases. He challenged the confidential token abstraction itself, saying the ecosystem needs to decouple token standards from privacy constructions so that fast-moving privacy innovations don't get bottlenecked by slow-moving token standards. Predicate's head of business development emphasized that privacy and compliance evolve together, not sequentially, and that understanding how privacy works remains the biggest barrier to mainstream adoption. The panel identified a critical gap: the ecosystem has mature cryptographic technologies (zero-knowledge proofs, fully homomorphic encryption) but few production-grade products. Selective disclosure has existed in Zcash since its inception without breakthrough applications. Regulatory uncertainty compounds the problem. Until recently, US-based builders largely avoided privacy work, but a more permissive regulatory environment is now enabling product development. To address this, SDF announced Protocol 25 X-Ray, delivering cryptographic building blocks including pairing-friendly elliptic curves and Poseidon, a ZK-friendly hash function. SDF is integrating Noir, a developer-friendly domain-specific language for zero-knowledge circuits, and RISC-Zero verifiers. With Nethermind, SDF is building Stellar Private Payments (SPP), a privacy-preserving protocol based on Vitalik Buterin's Privacy Pools research. SDF is simultaneously shipping a confidential tokens implementation aligned with Confidential Token Association standards.
