Last updated 6 months ago
Privacy-centric applications rely on a critical piece of infrastructure to enable anonymous transactions on transparent ledgers—a component that is currently missing in Cardano
We are building a decentralized, permissionless, and incentivized infrastructure that enables anonymous interactions with private smart contracts and Dapps.
This is the total amount allocated to Anonymous Transactions: Building Cardano’s Privacy Infra.
Please provide your proposal title
Anonymous Transactions: Building Cardano’s Privacy Infra
Enter the amount of funding you are requesting in ADA
74000
Please specify how many months you expect your project to last
7
Please indicate if your proposal has been auto-translated
No
Original Language
en
What is the problem you want to solve?
Privacy-centric applications rely on a critical piece of infrastructure to enable anonymous transactions on transparent ledgers—a component that is currently missing in Cardano
Does your project have any dependencies on other organizations, technical or otherwise?
Yes
Describe any dependencies or write 'No dependencies'
Yes, the project will use the Dolos light-node developed by TxPipe.
Will your project's outputs be fully open source?
Yes
License and Additional Information
Software Libre - GPLv3
Please choose the most relevant theme and tag related to the outcomes of your proposal.
Privacy
Describe what makes your idea innovative compared to what has been previously funded (whether by you or others).
Since privacy in the Cardano ecosystem is still underdeveloped, there is currently no project that addresses the need for a relay system to send anonymous transactions. The relevance of this proposal lies in the fact that, as a general rule, to work on transparent ledger, most privacy protocols require a network of relays to interact anonymously with private smart contracts. From a technical standpoint, the problem stems from the need to provide collateral to execute a transaction; a relay system solves this limitation. Such infraestructure is crucial for fully enabling private Dapps.
Describe what your prototype or MVP will demonstrate, and where it can be accessed.
The prototype will demonstrate:
The project will be accesses through the public github repository.
Describe realistic measures of success, ideally with on-chain metrics.
Since it is a prototype we will use the following technical metrics:
Transactions records: Records of succesful transactions with the protocol.
Successful unit tests: The software passes the unit test explicited on the milestones.
Resource use: Records of resource use of the relays.
Please describe your proposed solution and how it addresses the problem
The transparent nature of Cardano presents significant challenges to achieving robust privacy on the network. While advancements in cryptographic techniques, such as Zero-Knowledge proofs, have made meaningful progress, they alone are not sufficient. Additional layers of infrastructure are required to enable true anonymity and protect user privacy.
The requirement to provide collateral when interacting with smart contracts poses a challenge for anonymous users. If users supply the collateral directly, they risk exposing their identities. To preserve privacy, many protocols rely on intermediaries known as relays. These relays are incentivized to act on behalf of users, submitting their cryptographic proofs and covering the collateral, thereby enabling interaction with the smart contract without compromising anonymity. This relay infrastructure will be essential for most privacy-focused projects within the Cardano ecosystem. Decentralized applications such as voting platforms, mixers, and private wallets will depend on a robust and reliable system of relays to ensure user anonymity.
Therefore, our proposal is to build a decentralized and permissionless relay infrastructure that can serve as a foundational layer for privacy reserving applications on Cardano.
We aim to create a protocol that enables relays to be incentivized for their services. Relays will be able to submit proofs on behalf of anonymous users and receive rewards in a decentralized and permissionless manner. To support this, we will develop a smart contract that allows any privacy protocol to integrate with the relay system, ensuring that relays can operate trustlessly and openly across the Cardano ecosystem.
We plan to build a standardized relay implementation using Dolos, a lightweight Cardano node. This choice is critical to ensuring accessibility and scalability across the network. Unlike full nodes, which require substantial computational and storage resources, Dolos operates with approximately 1% of the requirements of a regular full node. This drastic reduction in resource consumption significantly lowers the barriers to entry for individuals and organizations interested in running relays. By making it easier and more affordable to operate a relay, we aim to foster a larger, more decentralized, and resilient network of relays.
Our implementation will also include a robust and well-documented API, allowing seamless integration with a wide range of privacy-preserving protocols, including mixers, voting systems, and private wallets. This API will provide a standard interface for submitting cryptographic proofs, requesting transactions, and receiving incentives, ensuring interoperability and ease of use for developers. By combining the efficiency of Dolos with an accessible relay protocol, we aim to empower privacy-focused dApps with the infrastructure they need to operate securely and anonymously, while enabling a permissionless environment for relay operators.
Once the prototype is finished. We'll propose this solution to the Encoins community, which currently includes over 45 experienced relay operators. This could be a great opportunity to bootstrap the solution in a community that has already has need for a relay and have the experience to offer the privacy service to the Cardano community.
n conclusion, our goal is to strengthen the privacy sector in Cardano by developing a decentralized and permissionless relay protocol. This will provide the necessary infrastructure for privacy-focused applications to operate securely, without compromising anonymity, and without relying on centralized intermediaries.
Please define the positive impact your project will have on the wider Cardano community
This proposal could have the following impacts on our ecosystem:
What is your capability to deliver your project with high levels of trust and accountability? How do you intend to validate if your approach is feasible?
From a technical standpoint, the team has extensive experience in the development of privacy-focused applications. We have worked on solutions such as zero-knowledge applications, open-source tools, and smart contracts. For example, the team has contributed to several projects leveraging zero-knowledge cryptography, including the Mastermind game, the Semaphore protocol, and the Proof-of-Innocence compliance solution. Additionally, we have been involved in the development of the Encoins protocol. This track record demonstrates our ability to deliver complex solutions that demand a high level of technical competence.
In terms of accountability, we had succesfully delivered the previous catalyst proposals:
Milestone Title
Design and relay protocol development
Milestone Outputs
Acceptance Criteria
Evidence of Completion
Delivery Month
2
Cost
25000
Progress
30 %
Milestone Title
Transaction building library
Milestone Outputs
Acceptance Criteria
Evidence of Completion
Delivery Month
4
Cost
25000
Progress
60 %
Milestone Title
Node and backend development.
Milestone Outputs
Acceptance Criteria
Evidence of Completion
Delivery Month
7
Cost
24000
Progress
100 %
Please provide a cost breakdown of the proposed work and resources
Monthly Budget Breakdown (ADA)
First Month
Total Month 1: 12,333.33
Second month
Total Month 2: 12,333.33
Third Month
Total Month 3: 12,333.33
Fourth Month
Total Month 4: 12,333.33
Month 5:
Total Month 5: 12,333.33
Month 6:
Total Month 6: 12,333.33
Total budget:
How does the cost of the project represent value for the Cardano ecosystem?
The cost of the project delivers strong value to the Cardano ecosystem by addressing a critical gap in its privacy infrastructure. Most privacy-centric dApps require a relay network to enable anonymous transactions, a component currently missing in Cardano but critical effective in other ecosystems such as Ethereum.
This proposal not only develops that missing infrastructure but also opens the possibility of adoption through the ENCOINS team’s network of 45+ active relay operators. By leveraging the Dolos light node with guidance from TxPipe, the solution will be secure, scalable, and permissionless—lowering the technical barrier for new privacy-focused dApps to launch on Cardano.
The result is a foundation for a thriving privacy ecosystem that can attract new users, retain those with strong privacy needs, and unlock high-value use cases such as mixers, voting dApps, and private wallets.
Terms and Conditions:
Yes
The proposal is led by Agustín Salinas, a privacy infrastructure and zero-knowledge expert in the Cardano ecosystem, and core contributor to Módulo P—an initiative developing ZK-based privacy solutions for Cardano’s EUTxO model. Agustín has contributed to multiple Catalyst-funded projects focused on ZK proof verification, governance tooling, and privacy infrastructure.
The project is supported by the ENCOINS protocol team, operators of a live mainnet privacy solution and coordinators of more than 45 active relay operators, who will serve as early adopters of the proposed decentralized relay network.
This combination of privacy expertise, established community adoption, and infrastructure leadership uniquely positions the team to deliver a secure, scalable, and permissionless relay infrastructure for Cardano.