Stellar introduces Confidential Tokens, a privacy layer for SEP-41 tokens built by OpenZeppelin and Nethermind. The wrapper contract architecture hides balances and transfer amounts via zero-knowledge proofs while keeping addresses visible—designed for institutional use cases like payroll and treasury management. Testnet live now.
Stellar's Confidential Tokens add privacy to existing SEP-41 tokens through a wrapper contract that hides balances and transfer amounts using zero-knowledge proofs and Pedersen commitments. Built in partnership with OpenZeppelin and implemented with Nethermind's UltraHonk verifier, the design deliberately maintains sender and recipient visibility while encrypting values—a key distinction from full-privacy pools like Stellar Private Payments. The preview includes compliance-oriented features: auditor view keys for transaction inspection, selective disclosure for proving specific transactions, account-level freezing, and a pluggable policy engine for identity registries. The architecture isolates privacy at the application layer, contained entirely within the wrapper contract to prevent any vulnerability from affecting the underlying asset. Developers can test the demo on Stellar Testnet now, with audits underway before mainnet deployment.
