Why private transactions are still hard to use
Justin Giudici, Telos
Moment at 32:54Episode 1 · Nothing to Hide: On-Chain Privacy in 2026
Wallet Privacy, A White-Label Private Mode for Wallets and dApps
In short
White-label wallet privacy using the Ethereum Foundation's Kohaku SDK: add Private Mode without building a ZK team, relayer, or indexer from scratch.
Reviewed by Luis Medeiros, Field CTO at ProtofireLast reviewed: June 2026
3-5 seconds
proof generation
80%
faster proofs
0.2%-1%
transaction fees
Trusted by teams building on-chain
Wallet privacy is the ability to make on-chain activity confidential, shielding amounts, counterparties, and balances, without leaving the wallet your users already trust. A private wallet, or a "Private Mode" inside an existing one, lets a user route funds through a shielded pool so their transactions are not exposed in plaintext on a public ledger.
On a transparent chain, every balance and transfer is visible to anyone, and for high-value users, funds, treasuries, payroll operators, and active traders, that openness is a liability: trading strategies leak, salaries get doxxed, and counterparties are exposed, so wallets are increasingly losing those users to dedicated privacy alternatives.
Protofire integrates a white-label Private Mode into wallets and dApps using the Kohaku SDK: the Ethereum Foundation's open-source privacy framework, currently in alpha and not yet production-ready. We handle the relayer, indexer, proving circuits, adapters to live privacy protocols, and compliance hooks; your team toggles the feature on.
We don't own or sell Kohaku, we're the engineering partner that integrates it, and we've already shipped a production privacy wallet on mainnet.
Privacy-wallet integration stack we assemble end to end
Protofire deploys and maintains every layer between the Private Mode toggle and the shielded on-chain pool.
01
Wallet UI / Private Mode toggle
The user-facing switch that routes funds into the shielded flow without changing the wallet UX or custody model.
02
Kohaku SDK
The Ethereum Foundation's open-source privacy SDK (alpha, pre-production) with standard plugin interfaces for shielded-pool protocols; Protofire integrates, configures, and maintains this layer inside your wallet.
03
Privacy-protocol adapters
Protofire-built adapters to protocols that are live today, such as Railgun, Privacy Pools, and 0xCurvy, so the wallet never depends on a single provider.
04
ZK proving circuits
Rust-based zero-knowledge proofs that break the public link between sender, receiver, and amount; on Telos we cut proof time from 15-25 seconds to 3-5 seconds.
05
Relayer and indexer
Protofire-operated services that submit shielded transactions and track shielded state without exposing either to the public network.
06
Shielded pool with compliance hooks
The smart-contract layer where funds move through the privacy pool; compliance hooks support optional KYC and transfer rules for institutional use.
01
What wallet privacy is
Wallet privacy means a user can transact without broadcasting the details of that transaction to the entire network. In practice it looks like a Private Mode toggle in the wallet UI: when it's on, funds move through a shielded pool, and the link between sender, receiver, and amount is broken on-chain.
The user keeps custody and a familiar UX; what changes is what the public ledger reveals. This is selective confidentiality, not a black box, it pairs shielded transfers with compliance hooks and optional KYC so the feature stays usable for institutions rather than reading as an opaque mixer.
For a wallet team, the point is differentiation: power users and institutional clients want confidentiality by default, and it keeps them inside your product instead of pushing them toward a separate privacy wallet. Benefits: a privacy feature your best users actually ask for · selective disclosure instead of full transparency · retention of high-value, institutional accounts.
The feature is built on the Kohaku SDK, the Ethereum Foundation's privacy framework, which Protofire integrates into your wallet. Kohaku defines standard plugin interfaces for shielded-pool protocols, and it is still alpha and pre-production, so we build to those interfaces and keep the integration current as the SDK matures.
Rather than betting on a single privacy protocol, we build adapters to protocols that are live today, such as Railgun, Privacy Pools, and 0xCurvy, chosen for the chains and assets your users hold, so the wallet is never dependent on one backend. Underneath the toggle, a full stack does the work, a relayer to submit shielded transactions, an indexer to track shielded state, ZK proving circuits to generate the proofs, and compliance hooks for transfer rules and optional KYC.
Protofire deploys and maintains all of it. The wallet team integrates the SDK and ships the UX; it never has to build or operate ZK infrastructure in-house. Benefits: multi-protocol support through Protofire-built adapters · no in-house ZK team required · proving, relayer, and indexer maintained for you.
Private Mode fits any EVM-compatible wallet or dApp with an active user base and real transfer flows. The clearest demand comes from institutional and operational use cases: private payroll, paying global contributors in USDC without doxxing individual salary tiers; B2B settlement where counterparty pricing is sensitive; treasury movements that shouldn't telegraph strategy; and traders who don't want their positions front-run.
For institutions weighing a shielded pool against Canton, Zama's FHE tokens or a private validium, our onchain privacy guide compares who can grant a regulator access in each. It also fits consumer wallets that are losing power users to dedicated privacy products, and chains that want native-wallet privacy to keep liquidity in their ecosystem.
The model is built to be a revenue stream as well as a feature: the shielded-transaction fee runs roughly 0.2%-1% per transaction, and the integrating wallet earns a share of that flow, turning a security feature into recurring revenue rather than a cost center. Benefits: covers payroll, B2B settlement, treasury, and trading confidentiality · keeps power users inside your wallet · a new transaction-fee revenue stream.
02
How an integration works
1
Design
We map the Private Mode UX into your existing wallet flow, define fee tiers, and scope the compliance hooks (transfer rules, optional KYC). Deliverable: an integration and UX plan.
2
Integration
We integrate the Kohaku SDK and stand up the backend: relayer, indexer, and proving circuits, with adapters to the privacy protocols you choose. Deliverable: a working shielded-transaction path in your wallet.
3
Launch
Testing, rollout, and a maintenance handover so the privacy infrastructure stays current after go-live. Deliverable: Private Mode in production, supported.
03
First-hand: shipping a production privacy wallet (Telos zkWallet)
Privacy is a hard usability problem: most protocols offer strong cryptographic guarantees but stay too complex and too slow for everyday payments. Telos partnered with Protofire to build Telos zkWallet, a privacy-enabled wallet for the Telos EVM ecosystem. During discovery we identified the real barriers as UX friction, infrastructure coordination, and proof latency.
Our approach was to ship the complete privacy stack, not a thin interface. We adapted the open-source zkBob protocol for Telos EVM and deployed privacy smart contracts, ZK-SNARK circuits, relayer services, and indexing infrastructure, packaged as a cross-platform desktop app (macOS, Windows, Linux) with a trusted-setup ceremony for the circuits.
The key move was native Rust-based proof generation: it cut proof latency from typical browser times of 15-25 seconds to roughly 3-5 seconds, up to an 80% improvement in responsiveness.
The outcome is a production privacy wallet running on Telos mainnet, with a UX comparable to a standard Web3 wallet (live demo). That is the same stack, relayer, indexer, ZK circuits, that the Kohaku-based Private Mode service productizes into a white-label, multi-backend integration. The difference now is that you don't start from scratch: we bring a shipped privacy wallet's worth of experience to your integration.
04
An engineering-led privacy partner
Protofire is a blockchain development company with 250+ projects shipped since 2016 across 60+ networks and 95+ protocols. Our credentials sit close to this work: we maintain Solhint, the open-source Solidity linter used by 1M+ developers and built with Ethereum Foundation grants; we deployed Safe on 120+ EVM networks, where it secures $2B+; and we shipped Telos zkWallet, a production privacy wallet with its own ZK circuits, relayer, and indexer.
On Telos we cut proof latency from typical browser times of 15-25 seconds to roughly 3-5 seconds with native Rust-based proof generation, a production privacy wallet now live on Telos mainnet at privacy.telos.protofire.io. So when we integrate a Private Mode, the privacy infrastructure underneath isn't theoretical, it's a stack we've built, deployed, and maintained on mainnet. That is what lets a wallet team add wallet privacy without standing up a ZK engineering function of its own.
“We handle the ZK stack; your team toggles the feature on.”
FAQ
What is wallet privacy, or "Private Mode"?
Wallet privacy is the ability to transact on-chain without exposing amounts, counterparties, and balances in plaintext. In a wallet it appears as a Private Mode toggle: when it's on, funds move through a shielded pool, breaking the public link between sender, receiver, and amount, while the user keeps custody and a familiar UX. What changes is what the public ledger reveals, not how the wallet feels to use. This is selective confidentiality, not a black box, it pairs shielded transfers with compliance hooks and optional KYC so the feature stays usable for institutions rather than reading as an opaque mixer. For a wallet team, the point is differentiation: power users and institutional clients want confidentiality by default, and the feature keeps them inside your product instead of pushing them toward a separate, dedicated privacy wallet.
What is Kohaku, is it your product?
No, and this distinction matters. Kohaku is the Ethereum Foundation's open-source privacy framework; Protofire's service integrates the Kohaku SDK into your wallet or dApp. We don't own, sell, or control Kohaku. We're the engineering partner that implements it and runs the supporting infrastructure. Kohaku is in alpha: its repository warns that parts of it are not ready for production use and that its packages contain unaudited code, and its reference wallet runs on the Sepolia testnet only. It defines standard plugin interfaces for shielded-pool protocols, and we build to those interfaces. We add adapters to protocols that are live today, such as Railgun, Privacy Pools, and 0xCurvy, so the wallet is never dependent on one backend, and we deploy and maintain the relayer, indexer, ZK proving circuits, and compliance hooks underneath. Your team integrates the SDK and ships the UX; it never has to build or operate ZK infrastructure in-house.
Is private-wallet activity compliant?
The integration is built for compliance-friendly privacy, not opacity. It includes compliance hooks for transfer rules and optional KYC, so the feature supports selective disclosure rather than behaving like an unaccountable mixer. It is selective confidentiality, not a black box: shielded transfers are paired with the controls an institution needs, so the feature stays usable for funds, treasuries, and payroll operators rather than reading as an opaque tool. During the design phase we map the Private Mode UX into your existing wallet flow and scope the exact controls, transfer rules and optional KYC, with your team, against your jurisdiction and risk requirements, before any build work starts. The aim is to keep confidentiality-seeking users and institutional accounts inside your product within a controlled, accountable environment, rather than pushing them toward a separate, unaccountable privacy wallet.
We're a wallet team without ZK engineers, can you still integrate this?
Yes, that's the entire point of the service. Underneath the Private Mode toggle, a full stack does the work: a relayer to submit shielded transactions, an indexer to track shielded state, ZK proving circuits to generate the proofs, and compliance hooks for transfer rules and optional KYC. Protofire deploys and maintains all of it. Your team integrates the Kohaku SDK and ships the UX; you never have to build or operate the zero-knowledge stack yourselves. This isn't theoretical for us: we shipped Telos zkWallet, a production privacy wallet with its own ZK circuits, relayer, and indexer, live on Telos mainnet. So the infrastructure underneath the toggle is a stack we've already built, deployed, and maintained, which is exactly what lets a wallet team add wallet privacy without standing up a ZK engineering function of its own.
Which privacy protocols does Private Mode route through?
Private Mode is never tied to a single privacy protocol. The Kohaku SDK defines standard plugin interfaces for shielded-pool protocols, and its plugins are still alpha, so for a production wallet we build and maintain adapters to protocols that are live today, such as Railgun, Privacy Pools, and 0xCurvy. We pick them with your team for the chains and assets your users hold and for each protocol's compliance model, so the wallet does not depend on any single provider. Supporting more than one protocol is a deliberate design choice: betting a wallet's entire privacy feature on one protocol creates a single point of failure, both technically and for liquidity. Because Protofire deploys and maintains the adapters along with the relayer, indexer, and proving circuits, your team gets that resilience without operating any of the backends. As Kohaku's plugins mature, the same standard interface lets the wallet add protocols without rebuilding Private Mode.
Can the wallet earn revenue from Private Mode?
Yes, the model is built to be a revenue stream as well as a feature. Shielded transactions carry a fee of roughly 0.2%-1% per transaction, and the integrating wallet earns a share of that flow, turning a privacy feature into recurring transaction-fee revenue rather than a cost center. The economics work because the demand is real and recurring: private payroll paying global contributors in USDC without doxxing salary tiers, B2B settlement where counterparty pricing is sensitive, treasury movements that shouldn't telegraph strategy, and traders who don't want positions front-run all generate steady shielded volume. Instead of treating confidentiality as a security cost the wallet absorbs, the feature lets it pay for itself while keeping high-value, institutional accounts inside your product. We scope the fee tiers with your team during design, alongside the Private Mode UX and the compliance hooks.
How long does it take, and what does it cost?
We scope each integration in three milestones. In Design, we map the Private Mode UX into your existing wallet flow, define the fee tiers, and scope the compliance hooks, transfer rules and optional KYC, producing an integration and UX plan. In Integration, we integrate the Kohaku SDK and stand up the backend: relayer, indexer, and proving circuits, with adapters to the privacy protocols you need, delivering a working shielded-transaction path in your wallet. In Launch, we handle testing, rollout, and a maintenance handover so the privacy infrastructure stays current after go-live, leaving it in production and supported. We size effort and cost against your wallet's UX surface, the privacy routes you need, and your compliance requirements, and confirm a fixed scope and estimate before any build work starts, so there are no open-ended commitments.
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