Aptos Says New Privacy Coin Balances Security, Transparency
According to Sherry Xiao, founding engineer of Aptos Labs, Aptos' newly introduced Privacy Coin can fix the old trade-off between protecting user privacy and maintaining transparency for compliance.
“Secret APT” launched on Aptos Mainnet on Friday. It uses zero-knowledge authentication to hide token balances and transfer funds while still allowing transactions to be authenticated.
Source: Apartments
While blockchains offer a level of transparency that most traditional ledgers do not, the lack of privacy has slowed individual and corporate adoption due to the risk of exposing sensitive financial information.
In an interview with Cointelegraph, Xiao said that the Secret APT – posted 1:1 with Aptos (APT) – reduces the risk of users' wallet profiling or targeted fraud:
“Portfolio fraud, social pressures from visible holdings, personal security – these are the symptoms people feel today.”
Secret APT can hide salaries, trading strategies.
Xiao said that the secret APT token also solves a problem that is active in the workplace.
“If a company runs a visible payroll chain, every employee's salary is permanently public — to coworkers, competitors, employers, everyone,” she said.
“It's the same with treasury activities, settlement flows, trading strategies,” Xiao said, explaining that blockchain's lack of privacy is an “operational compromise” for many businesses.
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However, “Secret Scales solves that directly,” Xiao said.
A backdoor function can be enabled for diagnostic purposes.
According to Xiao, a secret APT can still comply with your client's and anti-money laundering checks during an investigation or subpoena using the auditor's keys.
Auditor keys can only be authorized following a successful on-chain management vote:
“This approach allows the relevant parties access to information such as transfer rates for investigations, while maintaining privacy as a default for users.”
While Secret APT hides token balances and transaction volumes, the included wallet addresses and transaction confirmation are still visible, distinguishing it from other privacy-focused cryptocurrencies such as Monero (XMR).
Xiao said she expects individuals to adopt Privacy APT more quickly than businesses, adding that integrating Privacy Coin into the tax reporting pipeline and compliance will take some time.
That said, “If Secret APT has been on the main network for six months with strong voice and no problems, this is a proof point that shortens the enterprise sales cycle,” Xiao added.
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