About Secret Network: Powering Web3 Privacy

(Last Updated On: June 23, 2023)

Secret Network is the unique project is the first blockchain with customizable privacy, allowing users to choose what they share, with whom, and how. This level of control not only protects users but also empowers developers to create a more secure and user-friendly Web3.

Why We Need Privacy: Essential for Web3

Launched in 2020, Secret Network is the first mainnet blockchain with privacy-preserving smart contracts. This groundbreaking feature enables the development of decentralized and permissionless applications that also maintain user privacy.

The network’s smart contracts, known as “Secret Contracts,” have encrypted inputs, outputs, and state by default. Despite this, the underlying ledger remains transparent and completely auditable, striking a balance between privacy and transparency.

Ethereum’s introduction of smart contracts on the blockchain was a game-changer. These self-executing contracts, which automatically execute once pre-set conditions are met, enabled the creation of decentralized applications (dApps) beyond just payment systems.

However, most blockchains are public by default, meaning all transactions and smart contract interactions are visible to anyone. For certain applications and use cases, such as sharing sensitive health or financial data, this level of transparency is not desirable. This is where Secret Network comes in.

Unlocking New Possibilities: Use Cases for Secret Contracts

Secret’s smart contracts are private-by-default, meaning that inputs, outputs, and state are encrypted and can’t be viewed by others unless access is granted. This opens up use cases that aren’t possible on public-by-default blockchains.

For instance, a healthcare dApp built on Secret Network could allow patients to share their medical records with specific doctors while keeping that information hidden from the public.

Hold and Use Your Tokens in Privacy: Secret Tokens

Secret Network introduces a new standard, SNIP-20, which allows any token to become privacy-preserving through Secret Bridges. Once your tokens are “Secret,” balances, transaction details, and token metadata can only be accessed with a viewing key. This means you can hold and transfer your crypto in privacy, sharing your details with others only when you choose to.

Stay Safe While Spending, Saving, and Trading: Secret DeFi

Decentralized finance (DeFi) applications built with Secret’s privacy-preserving smart contracts provide resistance to Miner Extractable Value (MEV) by default and protect users from hackers and front-runners. This includes exchanges, market makers, lending protocols, and more. With Secret DeFi, your financial details can’t be viewed by anyone else unless you choose to share them, protecting your assets from prying eyes, hackers, MEV bots, and front-running.

An Example of Secret Tokens in Action

To better understand the potential of Secret Tokens, let’s consider a hypothetical scenario. Imagine a company that chooses to hold its assets in crypto. They might want to keep part of it in stablecoins like USDC to offset risk.

The company can decide to hold its USDC as Secret Tokens—sUSDC—in a private wallet. This way, they can keep a portion of their funds available for paying employees and contractors, sponsoring events, and buying merchandise.

Because part of the company’s assets are stored in sUSDC, their balances and activities can’t be viewed on the blockchain. This protects the company from potential malicious actors who might be interested in the company’s total wealth.

However, the company can convert its sUSDC to regular USDC at any point if it needs to use it. And if the company is audited, it can give the auditor its sUSDC viewing key to confirm their funds.

The Benefits of Secret DeFi

Decentralized finance (DeFi) has significant advantages over traditional finance: it’s open to all, censorship-resistant, cheaper to maintain, and anyone can inspect the code that governs it.

However, most DeFi projects and applications are built on blockchains that reveal all user data. Wallet addresses, balances, and transfers can be viewed on a public ledger and used by others to profit at the expense of the app’s users.

With Secret Contracts—Secret’s privacy-preserving smart contracts—user data is private by default and can’t be viewed by others unless given permission. This gives users of Secret DeFi apps protection from hackers and scammers. If others can’t figure out how much you hold, you’re much less likely to become the target of hackers and scammers. Even if hackers manage to get access to your wallet, they won’t be able to view your funds if you stored them as Secret Tokens—the token standard used in Secret DeFi apps. 

Furthermore, Secret Contracts provide safety from front-running and MEV bots. Front-running and miner extractable value (MEV) occur when actors use knowledge of future trades and transactions to make a profit, often at the expense of individual investors. But with Secret Contracts, orders are never visible on the mempool, and no attacker or malicious miner can front-run orders.

Conclusion: The Future of Privacy in Blockchain

Secret Network is pioneering a new era of privacy in the blockchain space. With its privacy-preserving smart contracts and Secret Tokens, it’s providing users with the control and security they need in the Web3 world. Whether you’re a developer looking to build secure dApps or a user seeking privacy in your crypto transactions, Secret Network offers a promising solution.

As we continue to explore the potential of blockchain technology, the importance of privacy cannot be overstated, and Secret Network is leading the way in this crucial aspect.

How to Buy Secret Network (SCRT) with Crypto

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