by Soorajksaju
The design of public blockchains inherently offers transparency, making them superior in auditability and openness when compared to private or centralized databases. Nonetheless, this advantage does not extend to providing privacy for transactions or secure asset storage, necessitating the pursuit of alternative privacy solutions. The requirement for smart contracts to enable intricate financial applications adds another layer of complexity to the issue.
In a scenario where existing blockchains do not offer both smart contracts and privacy by default, the creation of privacy-centric protocols on smart contract platforms presents itself as an effective solution. Encoins has capitalized on Cardano’s robust infrastructure to develop encrypted coins, offering increased privacy for transactions.
2023 was a crucial year, culminating with the mainnet launch in December. This article outlines the roadmap for 2024 and revisits the milestones achieved thus far.
A Timeline of Success: Our Achieved Milestones
When considering the strides we have made, it’s important to spotlight the major milestones that have influenced our direction and built a foundation for further development.
In December 2023, our project reached a pivotal milestone with the mainnet launch, setting the stage for a concentrated effort to refine and elevate our ecosystem. The focus has been on critical aspects that would ensure the protocol’s robustness and its capacity to serve our users effectively.
Milestone Summary:
- Mainnet Launch Achievement (December 2023): Successfully launched the mainnet, transitioning Encoins from concept to a functioning protocol.
Performance Enhancements:
- Relayer and Delegator Dynamics: Concentrated on improving interactions to boost operational efficiency and ecosystem robustness.
- Protocol Refinement: Addressed minor bugs and made adjustments to enhance functionality, showcasing our dedication to ongoing improvement.
Community and Transparency:
- Open-Source Protocol: Upheld a commitment to transparency and community involvement by keeping the protocol open-source.
- Light Relayers Introduction: Lowered entry barriers for individual participants, promoting a more decentralized network.
Enhancing User Experience:
- Cloud Backup Feature: Developed to facilitate easy and secure token restoration, emphasizing our commitment to security and a frictionless user experience (coming soon).
Community Growth and Participation:
- Relayer Support: Garnered the support of 45 relayers, managing nearly 5 million $ENCS, representing 33% of the total supply.
- Token Circulation: Ensured 15 million $ENCS were in circulation, with 1 million vested over 40 months, demonstrating active engagement and a strategic distribution approach.
- Simplified Delegation Mechanism: Enabled $ENCS holders to share in $ADA fee earnings from transactions, encouraging participation and fair rewards distribution.
The support from our community and Catalyst funding has been instrumental in reaching these milestones, laying the groundwork for future growth.
We are now focusing on developing Encoins V2 and introducing a fiat-to-crypto on/off ramp solution, aiming to meet user demands and expand our ecosystem’s reach.
Next Step in Our Evolution: Encoins V2
While Encoins V1 brought enhanced privacy to Cardano transactions, it was hindered by its narrow focus on Ada and a dependency on off-chain proof generation, which introduced centralization and scalability issues.
Encoins V2 emerges as a refined version, specifically engineered to address these shortcomings. It broadens the protocol’s applicability, strengthens its decentralization, and improves interoperability across the Cardano network.
The primary objective of V2 is to elevate privacy, streamline usability, and encourage ecosystem-wide collaboration.
Quick Guide to ENCOINS v2
- Expanding Supported Assets: Transitioning from accepting only Ada to including all native assets, enhancing the protocol’s compatibility and potential for broader application.
- On-Chain Proof Verification : Moving towards a fully decentralized model by implementing on-chain proof verification, eliminating the need for a trusted third-party verifier.
- Plutus V3 Integration: The implementation of Plutus V3 is crucial for the full realization of Encoins V2’s vision.
- Ledger Mode: Store your coins within the protocol for secure, private transactions. Create NFTs with hidden values using zero-knowledge proofs.
- Public APIs: Enable collaborations and integrations with other Cardano DApps and services, broadening the protocol’s reach.
- Decentralized Governance: Introduction of a DAO-driven governance model, contributing to the protocol’s direction and decisions.
- UI Redesign: Experience a wallet-like interface that simplifies interactions without compromising on features.
Now let’s get into the details.
Expanding Supported Assets
By transitioning from accepting only Ada to including all native assets, Encoins V2 significantly enhances the protocol’s compatibility with a wider array of digital assets.
Accommodating all native assets facilitates deeper integration with other protocols and platforms within the Cardano ecosystem and potentially beyond. This interoperability is crucial for building a more cohesive and functional DeFi landscape, where assets and value can flow seamlessly between different applications and services.
Decentralization with On-Chain Proof Verification
Moving proof verification on-chain is a step towards achieving full decentralization. By removing the need for a trusted third-party verifier, Encoins V2 significantly reduces central points of failure and vulnerabilities associated with relying on external entities for transaction validation.
This approach aligns with the foundational principles of blockchain technology and enhances the protocol’s security and trustworthiness. Users can transact with the assurance that their transactions are verified directly by the blockchain, without the intervention of potentially compromised or biased parties.
Plutus V3 Integration
The integration of Plutus V3 is essential for the evolution of Encoins V2, dramatically improving its capabilities. This upgrade is crucial for conducting sophisticated operations like on-chain proof verification, essential for moving away from trusted third-party verifiers towards a more decentralized model.
Plutus V3 is crafted to enhance the execution of complex smart contracts, thus addressing the prevalent issues related to transaction sizes and computational restrictions. For Encoins V2, this means the capability to include advanced features and functionalities in its smart contracts, ensuring the protocol is equipped to manage complex transactions and verifications on the blockchain efficiently.
Ledger Mode
At the heart of ENCOINS v2 is the Ledger Mode, a feature that is designed to enhance privacy and security for transactions by allowing users to store their coins directly within the protocol at the Cardano script address. This facilitates confidential payments without the necessity of a traditional Cardano wallet.
Here’s a detailed breakdown of how ENCOINS Ledger Mode works:
- Creation of Encrypted Coins (ENCOINS): Users can create NFTs, known as encoins, with secret redeeming values. These NFTs store their redemption values (ADA) in an encrypted format using zero-knowledge proofs, ensuring that the amount of ADA stored within each encoin is kept private and enhancing transaction privacy.
- Storing Coins in the Protocol: In Ledger Mode, users have the flexibility to store their coins directly in the protocol. This means that the coins are kept at the Cardano script address, allowing for the execution of confidential payments without the need for a traditional wallet. This mode is particularly beneficial for users seeking to maintain high levels of privacy in their transactions.
- Privacy for Recipients: When payments are made in encoins using the ENCOINS Ledger script, the recipient’s privacy is preserved as long as they do not withdraw the encoin. If the recipient also makes Ledger Mode payments with these coins, the privacy benefits are extended further.
- Interactions with Other Users and DApps: ENCOINS conceals the amount of ADA in a user’s wallet when transacting with other users and decentralized applications (DApps). This not only boosts the user’s privacy but also the privacy of the users they interact with. For example, if Alice deposits 1000 ADA into the protocol and receives three encoins redeemable for specific amounts, only Alice knows these redemption values. When she transfers one of these encoins to Bob, their exact ADA holdings become indeterminate, enhancing privacy for both parties.
Additionally, ENCOINS v2 has developed public APIs, enabling seamless integration and collaboration with other Cardano DApps and services. This integration enhances the protocol’s utility and improves the user experience by allowing more direct connections with existing Cardano wallets.
A significant shift towards decentralized governance is also part of ENCOINS v2’s roadmap, with plans to transition the treasury management to an Agora-based DAO. This change is designed to increase community participation in decision-making, ensuring that the protocol’s development reflects the community’s needs and interests.
The UI and UX redesign of ENCOINS v2 focuses on user accessibility and simplicity. By adopting a wallet-like interface, the redesign makes the protocol more approachable for users, hiding its underlying complexities. This ensures that users can enjoy a seamless and intuitive experience, despite the protocol’s advanced privacy features.
A Journey Towards a Brighter 2024
The progress of Encoins has been significantly shaped by the unwavering support and active participation of the Cardano community. This collective effort has been pivotal in achieving major milestones, including the launch of the mainnet.
Looking ahead to 2024, the roadmap for Encoins delineates a strategy to confront the complex challenges of enhancing privacy and smart contract capabilities within the Cardano ecosystem.
The forthcoming Encoins V2 represents a critical evolutionary step for the protocol, incorporating the mainnet’s successful deployment and planned technical improvements. Key technological upgrades, including Plutus V3 integration and the adoption of on-chain proof verification, are expected to greatly enhance the protocol’s capabilities. The protocol’s commitment to expanding supported assets, integrating public APIs, and transitioning to DAO governance underlines its dedication to building a more cohesive and democratically governed ecosystem of applications on Cardano.
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