COTI Foundation Developing Advanced Privacy Layer on Ethereum for 2025
Overview of COTI Foundation
COTI Foundation is developing a confidentiality layer on Ethereum. Initially launched as a payments platform in 2017, COTI now focuses on enhancing privacy solutions to facilitate blockchain adoption by traditional financial institutions.
Innovative Technology: Garbled Circuits
COTI employs Garbled Circuits (GCs) for privacy, distinguishing itself from other projects using Zero-Knowledge Proofs (ZKPs). Key advantages include:
- Efficiency: 1,800-3,000x faster than Fully Homomorphic Encryption (FHE)
- Decentralization: No need for trusted hardware, mitigating supply chain risks
- Multi-Party Computation: Supports multiple encrypted inputs, unlike ZKPs
COTI encrypts transactions as circuits, ensuring privacy through garbling, with only authorized users able to decrypt outputs.
Privacy-on-Demand and Cross-Chain Integration
The "Privacy-on-Demand" feature enables private transactions across major blockchains via integration with Axelar. A mainnet launch is expected in late Q1 2025, with V1 tokens migrating to the new Layer 2 solution, currently undergoing testnet evaluations.
Importance of COTI
Robust privacy is crucial for Web3 integration by traditional businesses due to:
- Compliance with data protection regulations
- Protection against MEV attacks and front-running
- Security of sensitive business information
COTI aims to unlock significant institutional capital by addressing these privacy concerns.
Future Initiatives
Major developments planned for 2025 include:
- Confidential DeFi: Collaborations with Bancor and EEA to enhance privacy in decentralized finance
- AI and Web3 Integration: Merging artificial intelligence with blockchain while maintaining privacy
- RWA Platforms: Tokenization of real-world assets with necessary privacy measures
- CBDC Development: Contribution to a proof of concept CBDC platform for the Bank of Israel
Conclusion
COTI's advanced garbled circuit implementation allows private transactions with resources similar to standard non-private transactions, marking a significant achievement in blockchain privacy solutions. COTI Foundation's evolution positions it as a key player in the future of Web3 technology.