Author: Deng Tong, Golden Finance

From November 17 to 22, 2025, the Ethereum Developer Conference was held in Buenos Aires, Argentina, with over 75 teams showcasing their work. At this developer conference, attendees witnessed more possibilities in the crypto world, including DeFi, social, hardware and wallets, gaming, artificial intelligence, L2, and NFTs. Among the most eye-catching discussions were those centered around "privacy."

Projects such as Aztec, Fileverse, Holonym, Fluidkey, Rarimo (Unforgettable), Railgun, ZKPassport, 0xbow, and NYM made their appearances in the privacy zone.

1. Vitalik Releases Ethereum Privacy Protection Tool Kohaku

When Vitalik Buterin took the stage to demonstrate Kohaku, he candidly summarized the current state of Ethereum. The network boasts strong security and privacy research along with a solid Layer-1 security mechanism. However, it still lacks an "upgrade for the last mile," which refers to the wallets and applications that users actually use.

Theoretically, Ethereum has been at the forefront for the past decade. The introduction of elliptic curve precompiles in 2018 paved the way for zero-knowledge succinct non-interactive arguments of knowledge (zk-SNARKs) and the emergence of privacy tools like Tornado Cash and Railgun. The 2016 DAO hack prompted the entire ecosystem to undergo rigorous audits, driving demand for robust wallets like Gnosis Safe and transforming multi-signature from a niche concept into standard practice.

However, by 2025, everyday personal use still feels cumbersome. People need to remember additional mnemonic phrases, install dedicated wallets, and often choose centralized exchanges for their simplicity.

Kohaku is Ethereum's solution.

1. What is Kohaku?

Kohaku can be understood as a new privacy and security toolkit for wallets provided by Ethereum.

For developers, the Ethereum Foundation offers an open-source framework that includes a modular software development kit (SDK) and a reference wallet. This SDK provides reusable components for private sending, more secure key management and recovery, and risk-based transaction controls, allowing teams to avoid building the entire privacy protocol stack from scratch.

For users, the first version is a browser extension wallet aimed at advanced users, developed based on Ambire. It supports private and public transactions, independent accounts for each decentralized application, peer-to-peer broadcasting (instead of centralized relays), and tools to hide internet protocol (IP) addresses and other metadata as much as possible.

Kohaku's underlying architecture integrates seamlessly with existing Ethereum privacy tools (such as Railgun and Privacy Pools) rather than developing new mixers or layer-two networks. This allows Kohaku to focus on the truly missing part: a unified wallet architecture with built-in privacy, recovery, and security from the start, rather than adding them as experimental features over time.

2. How Does Kohaku Work?

Essentially, Kohaku is less of a "large application" and more of a set of Lego blocks for building a private and more secure wallet.

1) Wallet Architecture

Kohaku-style wallets do not use a single universal key but are designed with multiple keys with different roles, a risk-based approval mechanism, and a recovery process that does not rely on a single mnemonic phrase written on paper.

Transferring $100,000 will trigger additional review and confirmation procedures, while a $10 transfer will not. This is precisely the risk-based fund access mechanism that Vitalik has long advocated.

2) Protective Measures

Kohaku does not hide all transactions. It allows the wallet to provide both public and private key modes simultaneously. When the private key mode is selected, the wallet can route through protocols like Railgun or Privacy Pools to generate new, untraceable receiving addresses while minimizing on-chain space usage. Tools like association lists are built into the design so that teams can block obvious illegal fund flows without compromising the privacy of other users.

3) Network Privacy

Finally, the roadmap covers not only the data written to the chain but also extends to reading and network privacy. Kohaku aims to connect to mixed networks to hide IP-level metadata and ultimately integrate zero-knowledge browsers or remote procedure call (RPC) solutions, ensuring that even checking balances or reading decentralized application data does not quietly reveal your identity and actions.

3. Why is Kohaku So Important?

Kohaku is important because it addresses a problem that Ethereum has struggled with for years: the point of interaction between real users and the blockchain.

For years, research teams have continuously introduced faster proofs, more efficient cryptographic primitives, and more secure contract patterns. But on Kohaku, Buterin's complaints are more practical: additional mnemonic phrases, private pools not supporting multi-signatures, unreliable broadcasting, and cumbersome processes have forced users back to centralized exchanges because they are more convenient.

By focusing on wallets, Kohaku provides L2 networks and DApps with what they have long been missing: a shared, privacy-focused infrastructure. Previously, each Rollup or application needed to develop its own obfuscation address system, recovery process, and large transfer warning mechanism, while Kohaku offers a set of patterns and code that all applications can rely on. This is crucial in an ecosystem that increasingly presents a network of intertwined Rollups rather than a single blockchain structure.

Since Kohaku originates from the core Ethereum ecosystem rather than a startup's wallet, it is likely to become a reference model that other wallets need to meet or exceed.

Kohaku also forces Ethereum to confront some tricky issues.

• First, it is crucial to strike a balance between maximizing privacy and responsible privacy. Association lists, auditable privacy shields, and risk-based controls are precisely what regulators and banks want to see. However, for some users, any selective privacy visibility or blacklisting practices feel like the beginning of a slippery slope. Kohaku does not end this debate; it merely makes this contradiction more apparent.
• Additionally, there are technical risks. Managing multiple keys, recovery paths, privacy switches, different broadcasting options, and plugin modules presents a larger attack surface compared to simple mnemonic phrase wallets. This necessitates rigorous audits and clear rules for upgrades and default settings.
• Then there are the real-world issues of user experience (UX). The framework can provide some good patterns, but it cannot force teams to develop clear interfaces. If users cannot distinguish between private and public sending, what can be recovered, and which approvals are critical, then all these additional permissions become factors that are easier to err.

4. The Significance of Kohaku

For ordinary users, the emergence of Kohaku signifies that using Ethereum for private operations is no longer a secondary task.

The real test lies in whether mainstream wallets will truly adopt these concepts: clear privacy and public modes, simpler recovery processes, increased resistance to large transfers, and reduced chances of leaking all on-chain activities with a single click. If these concepts are realized, privacy will simply be an ordinary setting in your existing wallet.

For developers, Kohaku provides an infrastructure layer that can alleviate much of the heavy workload. They do not need to rebuild the underlying mechanisms for privacy and security but can rely on a shared toolkit to focus on the design and user experience of decentralized applications.

For institutions and regulators, this is a live experiment in privacy design and an opportunity to test how far Ethereum can enhance confidentiality without sacrificing auditability or legal clarity.

2. Discussions on Privacy by Other Industry Insiders

Danny Ryan, co-founder of Etherealize and former core researcher at the Ethereum Foundation, discussed how Wall Street institutions are gradually recognizing the necessity of decentralization. He pointed out that Ethereum has unique advantages in eliminating counterparty risk, ensuring uptime, and providing cryptographic security and privacy. Ryan emphasized that institutions are not interested in speculative tokens but focus on real-world applications, such as pension funds and real estate contracts. Privacy is a "gateway" for institutions: if privacy is poorly implemented, institutions may be reluctant to participate.

Val Keenburgh, Executive Director of Coin Center, noted, "Anything transparent cannot remain neutral, and anything neutral cannot survive unless it is large enough."

3. Overview of Projects in the Privacy Zone

Aztec

The core team behind Aztec Network is Aztec Labs, founded in 2018. Aztec is a privacy-first Layer-2 (ZK Rollup) solution on Ethereum. It uses zero-knowledge proofs to achieve programmable privacy, mixed public/private states, and bridges to the Ethereum mainnet through Aztec Connect. Currently, the Aztec public testnet is live, allowing users and developers to experience private transactions.

Fileverse

Fileverse is a decentralized, privacy-first file/collaboration platform. Users can manage their documents, pages, and multimedia with a wallet, managing access permissions through blockchain + smart contracts (using the UCAN permission network). Files are end-to-end encrypted (E2EE), requiring no centralized servers. Currently, Fileverse supports on-chain community collaboration (pages, wikis, personal notes) + multimedia + encrypted chat + access control, etc.

Holonym

Holonym builds the "human.tech" framework, a privacy infrastructure for digital identity. Through zero-knowledge technology, users can prove certain identity attributes (such as age, nationality, account reputation, etc.) without revealing their full identity. Its protocol "Human ID" uses ZK proofs for private identity verification (KYC/Sybil resistance/identity reconstruction). Designed products include: Zeronym (ZK identity), Silk wallet (user-friendly private wallet), Human Keys network, etc.

Fluidkey

Fluidkey is a privacy-focused Ethereum wallet interface that provides stealth addresses. A new address is generated each time funds are received, preventing observers from linking funds back to the same user. It supports "social login + multi-chain fund conversion + bank transfers" (e.g., IBAN / ACH / bank wire transfers). According to its website, the transfer volume has exceeded $400 million.

Rarimo

Rarimo's official website features several products, including Unforgettable and zk-Passport. zk-Passport allows users to verify identity attributes (such as nationality and age) using proof of identity documents like passports through ZK proofs without disclosing private data. Unforgettable.app is Rarimo's "self-recovering identity + wallet" module, enabling users to recover their wallets using ZK identity without exposing traditional seed phrases (mnemonic phrases). Rarimo supports social use cases such as "anonymous voting and opinion markets" while retaining ZK identity history (without exposing personal actions).

ZKPassport

"ZKPassport" allows users to verify identity attributes (such as nationality and age) using proof of identity documents like passports through ZK proofs without disclosing private data.

Railgun

Railgun is a decentralized protocol (not a traditional company) governed by a DAO. Railgun provides zero-knowledge-driven privacy contracts that allow users to conduct private transactions on-chain. It supports "private balances" + "0zk addresses" + concealing assets into private pools through Shielding. It offers "Private Proofs of Innocence": allowing proof that a certain address is not associated with certain bad actions (such as attacks), thus maintaining anonymity and compliance. Transaction history can be exported to generate shareable but encrypted/read-only "viewing keys," facilitating audits without disclosing all sensitive information. Railgun has integrated multiple chains (Ethereum, Arbitrum, Polygon, etc.). Its privacy design is considered an important infrastructure for DeFi privacy and has garnered widespread attention from the community.

0xbow

0xbow developed Privacy Pools—a protocol for achieving on-chain transaction privacy. It uses zero-knowledge proofs and a compliance layer called Association Set Provider (ASP) to screen user deposits to prevent associations with illegal activities. Users can deposit crypto assets (such as ETH, wBTC, USDC, etc.) into the Privacy Pool and then withdraw from different addresses, thereby severing the on-chain link between the deposit address and the withdrawal address. 0xbow aims to achieve compliance (monitoring for AML/illegal funding sources) without sacrificing privacy, responding to the DeFi industry's growing demand for balanced approaches to privacy and regulatory compliance.

NYM

NYM provides network-layer anonymity, achieving communication anonymity through a mixnet (similar to Tor, but protecting metadata through encryption, delay mixing, and delayed bandwidth). NYM has been used as a privacy communication infrastructure in multiple ecosystems.

4. Why Does Ethereum Place Such Importance on Privacy?

Why does Ethereum once again regard privacy as a core priority rather than a niche feature for advanced users?

In an article titled "Why I Support Privacy" published in April, Vitalik described privacy as a combination of freedom, order, and progress:

• It is freedom because people need space to act without worrying that every move they make is being recorded and judged.
• Order exists because many social and economic systems quietly rely on the fact that not everyone can see everything.
• It is progress because we want to use data for healthcare, science, and finance, rather than turning everyday life into a permanent surveillance live stream.

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