How Confidential Token Swaps Enhance Security While Maintaining Compliance
Blockchain's inherent transparency, while fostering trust and eliminating intermediaries, poses significant privacy challenges. Public ledgers expose users to risks like front-running attacks and financial surveillance, complicating compliance with data privacy regulations.
Privacy-focused solutions are emerging through innovative DeFi protocols and blockchains. Techniques such as zero-knowledge proofs, ring signatures, and stealth addresses aim to reconcile confidentiality with necessary transparency for secure transactions.
The tension between blockchain's security and privacy remains unresolved. Decentralization relies on public visibility, yet this very feature conflicts with growing demands for financial privacy and regulatory alignment.
