Tiger Research: Why Do Financial Institutions Prefer Selective Privacy?
The decisive narrative of 2026 is "privacy," becoming crucial as institutional players dominate crypto, serving as a key bridge between blockchain and real-world commerce.
Blockchain's core transparency exposes corporate secrets and investment strategies, posing substantial risks. While complete anonymity models like Monero lack KYC/AML compliance, making them unsuitable for regulated entities, financial institutions require selective privacy—protecting transaction data while maintaining regulatory compatibility.
Selective privacy, exemplified by Zcash, allows users to encrypt transaction details (sender, receiver, amount) using shielded addresses, with view keys enabling controlled disclosure. However, Zcash’s all-or-nothing approach limits its institutional adoption. In contrast, networks like Canton, adopted by DTCC and over 400 institutions, offer granular data disclosure, aligning with real-world compliance needs.
Privacy in blockchain is evolving from total anonymity to selective, regulated models. The future will prioritize infrastructure that balances privacy with practical financial workflows, driven by institutional demand.
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