What is Confidential Transfers?
A Token-2022 extension that enables encrypted token balances and private transactions on Solana.
Confidential Transfers Explained
Confidential Transfers is a cryptographic extension to Solana's Token-2022 program that allows token balances to be encrypted on-chain. Using ElGamal homomorphic encryption and zero-knowledge proofs, users can transfer tokens without revealing the amounts publicly. Only the account owner can decrypt and view their actual balance, while blockchain explorers see only encrypted ciphertexts.
Key Characteristics
- Balances encrypted using ElGamal encryption
- Transactions verified via zero-knowledge proofs
- Native Solana Token-2022 support
- Only account owner can decrypt balance
Real-World Example
When you stake FLPS with Privacy Mode enabled, your staking amount is encrypted on-chain. Blockchain explorers cannot see how much you staked, but the protocol can still verify you have sufficient balance using ZK proofs.
Related Terms
Frequently Asked Questions
What does Confidential Transfers mean?
A Token-2022 extension that enables encrypted token balances and private transactions on Solana.
How does Confidential Transfers work in DeFi?
Confidential Transfers is a cryptographic extension to Solana's Token-2022 program that allows token balances to be encrypted on-chain. Using ElGamal homomorphic encryption and zero-knowledge proofs, users can transfer tokens without revealing the amounts publicly. Only the account owner can decrypt and view their actual balance, while blockchain explorers see only encrypted ciphertexts.
Can you give an example of Confidential Transfers?
When you stake FLPS with Privacy Mode enabled, your staking amount is encrypted on-chain. Blockchain explorers cannot see how much you staked, but the protocol can still verify you have sufficient balance using ZK proofs.
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