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There’s definitely no doubt that Decentralization and Blockchain Privacy has been one of the most adopted system by most Web3 projects in world of Cryptocurrency and Blockchain Technology today. In today’s guide, we will be looking at an Interchain privacy protocol known as Namada Protocol which also cares about user privacy by making use of it Layer - 1 Proof-of-Stake for Interchain assets agnostic privacy
Namada Protocol serves as a Level 1 (L1) platform based on proof-of-stake consensus, designed to provide interchain asset-agnostic privacy. Through the Inter-Blockchain Communication (IBC) protocol, Namada seamlessly integrates with fast-finality chains, enabling smooth interoperability. Additionally, Namada establishes a trustless two-way bridge with Ethereum, facilitating secure and reliable communication between the two networks.
Namada prioritizes privacy by implementing an enhanced iteration of the Multi-Asset Shielded Pool (MASP) circuit. This upgraded version enables all types of assets, including both fungible and non-fungible tokens, to utilize a shared shielded set just exactly as that of Zcash. As a result, the act of transferring supported assets on Namada becomes distinct as it becomes difficult to identify due to the high level of privacy involved. Also, the latest update to the Multi Asset Shielded Pool circuit enables shielded set rewards which is a groundbreaking feature or incentive that allocates resources to promote privacy as a public good.
The integration of the Ethereum bridge into Namada eliminates the need for a separate protocol, as it becomes an integral part of the Namada ecosystem. Validators within Namada are entrusted with running the bridge alongside the core Namada protocol. These validators also serve as relayers when it comes to transferring assets to Namada, making the involvement of additional actors unnecessary. On the other hand, when transferring assets to Ethereum, external parties (known as relayers) are involved, although they bear no responsibility for validating or securing the bridge.
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Namada Protocol also has the ability to seamlessly connect with any fast-finality chain that supports the Inter-Blockchain Communication (IBC) protocol. When it comes to interoperating with Ethereum, Namada implements a specialized and secure Ethereum bridge that operates in a trustless manner. This bridge is carefully designed to prioritize safety by enforcing flow controls for all bridge connections and treating any faulty Ethereum transfers as a serious offense that can result in slashing penalties.
In the latest update of the Namada Protocol, users who hold shielded assets are incentivized to actively participate in the shared shielded set. This is made possible through the integration of the updated MASP circuit, which now includes the innovative Convert Circuit. By leveraging this new feature, Namada encourages users to contribute to the shared shielded set by holding shielded assets.
In Namada, the shielded set is considered a non-exclusive and anti-rivalrous public good. This means that as more individuals utilize shielded transfers, the level of privacy guarantees improves for each participant. The protocol recognizes the importance of collective adoption and participation in enhancing privacy for all users. Therefore, by incentivizing users to hold shielded assets and contribute to the shared shielded set, Namada fosters a stronger and more robust privacy ecosystem.
When it comes to shielded transfers, whether it involves an Ethereum non-fungible token (NFT), ATOM, or NAM, they are indistinguishable from one another. This means that the privacy-preserving features provided by the MASP (Modified Accumulator Sapling Protocol), an enhanced version of Zcash’s Sapling circuit, apply uniformly to all types of assets. The MASP circuit enables all assets within the Namada ecosystem to share the same shielded set. This approach ensures that privacy guarantees are not fragmented among individual assets. Regardless of the transaction volume associated with a particular asset, the privacy protection remains consistent and independent.