Privacy Mode — Technical Explainer

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This page explains exactly what ZecPad's Privacy Mode does — and, just as importantly, what it does not do. Read this before enabling Privacy Mode on a token you create, or before relying on it as a buyer.

In plain language

When a creator turns on Privacy Mode for a token, ZecPad uses a Solana feature called Confidential Transfer (part of the SPL Token-2022 standard) for that token's balances.

  • Hidden: the amount of tokens in a wallet, and the amount moved in each transfer.
  • Still visible to everyone: which wallet sent it, which wallet received it, when the transfer happened, and the fact that a transfer of this token occurred at all.

Think of it like a bank statement where the transaction line is public but the dollar amount is blacked out — not a fully anonymous cash handoff.

For readers who want the technical detail

ZecPad's Privacy Mode is implemented entirely with the Confidential Transfer extension of SPL Token-2022 (audited and maintained by the Solana program library, not a ZecPad-specific cryptographic system).

  • Balances and transfer amounts are encrypted using ElGamal encryption over the same elliptic curve used elsewhere in Solana, plus zero- knowledge range proofs that let the network verify a transfer is valid (the sender has enough balance, no value is created or destroyed) without revealing the amount.
  • Each wallet generates its own ElGamal keypair, derived from a signature over a fixed message with its Solana keypair — this is what the "session key" signature in ZecPad's wallet flow sets up.
  • Auditability: the Confidential Transfer extension supports an optional auditor key that can decrypt transfer amounts. ZecPad does not configure an auditor by default; the mint authority may choose to during setup.

What this is not

  • Not Zcash. Zcash uses zk-SNARK shielded pools where sender, receiver, and amount can all be hidden. ZecPad uses SPL Token-2022 Confidential Transfer, which — as of this writing — hides amounts only. Addresses are never hidden. See FAQ for more.
  • Not a mixer. There is no shielded pool that breaks the on-chain link between sender and receiver. Every transfer is still a normal, traceable Solana instruction between two known public keys.
  • Not compatible with public AMMs while shielded. Raydium and Orca do not currently support trading against confidential balances directly. A token's bonding-curve trades are always public (see below) — Privacy Mode applies to peer-to-peer holding and transfers.

Why bonding-curve trades are never private

ZecPad's curve price is a deterministic function of how much SOL and how many tokens have moved through the curve. If trade amounts on the curve were hidden, nobody could verify the displayed price was real — that would turn "fair launch" into "trust us." So:

  • Curve state (supply sold, SOL raised, price) is always public, even for Privacy Mode tokens.
  • Privacy Mode encrypts the buyer's resulting balance, not the trade amount going into the curve calculation itself. This is why the in-app copy says "Curve progress, supply and the mint stay public so buyers can still verify the launch."

Public token vs. Privacy Mode token

Public tokenPrivacy Mode token
Wallet balance visible on-chainYesNo (encrypted)
Transfer amount visible on-chainYesNo (encrypted)
Sender / receiver address visibleYesYes
Transaction timing visibleYesYes
Bonding-curve price / supply / SOL raisedPublicPublic
Requires extra wallet signatureNoYes (24h shield session)
Tradeable on Raydium/Orca post-migrationYesBalances remain confidential; curve/AMM-facing amounts are handled publicly the same as any token
Token programSPL TokenSPL Token-2022 with Confidential Transfer extension

Compliance note

Confidential balances can interact with AML/KYC and FATF Travel Rule obligations in ways that differ by jurisdiction — see Overview → Risk disclaimer. ZecPad does not currently offer a fiat on/off-ramp; if one is added, Privacy Mode tokens are likely to be excluded from it given these obligations.

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