Privacy is a polarizing topic for most people. Especially in Web3, where full transparency is a highly valued feature of the ecosystem, anything related to privacy or data protection is casually grouped with any other privacy-adjacent project. The “privacy currency” label is applied liberally.
However, random categorizations are not useful and it is important to distinguish user-centric data protection networks from “privacy” currencies used for unilateral asset transfers. Protocols like Oasis Network play a key role in balancing productive privacy with selective transparency for a more secure Web3, and details matter about how these integrations occur.
To better understand the taxonomy of privacy technology in Web3 and explore why Oasis Network is not a "privacy coin", this article explains the feature sets of monetary assets created specifically for secret transactions compared to development platforms to integrate confidentiality into decentralized applications.
The Oasis Network token is not a privacy coin.
ROSE is the native Oasis Network token used for gas fees, staking, delegation, and governance. But does it fit the “privacy currency” label?
The short answer is no.
The long answer has a few components. First, Oasis Network is a piece of Web3 infrastructure that supports the use and development of applications with diverse use cases and unique data confidentiality requirements. Neither Oasis Network nor its native token ROSE are simply another “privacy” cryptocurrency created to offer secrecy features for spending and unilateral asset transfers.
Secondly, the ROSE token has no privacy features. All ROSE transactions can be traced in Oasis Explorer, and even in the Sapphire confidential runtime, the metadata of encrypted transactions is clearly visible. What makes Oasis an industry leader is its native support for sensitive smart contracts that can protect various data payloads from unauthorized third parties.
Oasis Network is designed to serve serious builders and billions of users who care about protecting their data from the egregiously irresponsible standards of Web2 companies. In fact, there is a reason why Oasis Network is never mentioned alongside “privacy coins” in regulatory compliance or delisting announcements from exchanges. Oasis brings Smart Privacy to all Web3 sectors in a platform with customizable confidentiality that adapts to each use case for managing digital data.
So what really is a privacy coin?
When applied correctly, the label “privacy coin” generally refers to a type of cryptocurrency equipped with features that enhance anonymity and decrease traceability within digital transactions, similar to the privacy offered by physical cash. However, cryptocurrencies with features that enhance privacy, increase anonymity, and reduce traceability are the extent of the usefulness of these assets.
Privacy coins are designed to provide anonymity only in sending and receiving transactions. When Web3 users regularly make crypto transactions, these actions are not completely private. Each Bitcoin or Ether transaction is traceable to previous transactions, for example. Privacy coins want to offer an alternative to this system, but these coins have raised concerns from various political and regulatory agencies around the world.
In fact, privacy coins are facing more regulatory pressure now than ever due to these concerns about their potential use to facilitate illicit activities. As a result, exchanges like Binance, OKX, and others are feeling pressure to delist these “privacy” assets. But this regulatory pressure is often created from false narratives. A 2020 report from respected law firm Perkins Coie, for example, found that privacy coins pose no greater inherent risk to anti-money laundering operations than other cryptocurrencies. Their article also details the benefits of privacy coins and suggests that their usefulness far outweighs their risks. Cryptocurrency analysis company Chainalysis also explains the benefits of privacy coins here.
Participants in the digital data economy have much more valuable information to protect than simple transactions that move assets between two or more parties. This limited use case is important to some crypto natives, but it's important to avoid lumping every "privacy" project into the same category as single-purpose assets like "privacy coins." Oasis Network, for example, is designed to support flexible smart contracts that can meet the needs of any developer anywhere on the privacy and confidential computing spectrum. It is a simple category mistake to include this type of network in the same group as a privacy coin, since they exhibit different attributes and functionalities that differentiate one coin or network from another.
What is a confidential computing platform?
With technologies like the Sapphire runtime and accompanying Oasis Privacy Layer (OPL) framework, Oasis Network offers cutting-edge privacy tools to any Web3 developer, even those not directly based on Oasis Network. Importantly, the confidentiality built into the Oasis protocol is as robust as it is customizable. Flexible cross-chain confidentiality means creators and users can optimize degrees of efficiency, compliance, secrecy (or all of the above) based on their unique use case. In fact, fully compliant native confidentiality customizations are only possible in Oasis.
In short, Oasis is redefining the way developers think about privacy integration by reshaping the set of privacy tools available to them. Unlike “privacy coins,” which are limited to a binary privacy range and uses only for asset transfer, Oasis confidentiality is useful for almost any Web3 application. Here are some examples:
Private on-chain prediction feeds (see: Ocean Predictoor)
Decentralized and Confidential Onchain DEX (See: illumineX)
Confidential on-chain copy trading (see: SmartWhales)
MEV protection
Sealed Chain Auctions (See: PixelRealm)
Confidential Collectibles and NFT Data Protection (see: Crust and Rehide)
Blockchain execution times for private companies (see: deltaDAO)
Oasis differentiates itself from other networks and privacy technologies by optimizing efficiency and confidentiality simultaneously. Each dApp manages different amounts and types of user data, but each data load can be processed confidentially in Oasis in a way that protects users, achieves developer goals, and enables full operational compliance when necessary. Users and builders should not have to choose between compromising their sensitive data without any privacy or pursuing risky privacy solutions that could conflict with applicable laws and regulations. Oasis Network solves this problem.
What is the future of privacy for Web3?
Digital privacy is a basic human right. Oasis Network is built and contributed to by a vibrant, decentralized community of engineers and developers who create this. Notably, many of the top contributors have PhD degrees and are specialists in computer security and cryptography. By creating a spectrum of confidentiality with unlimited customization, Oasis Network redefines the way developers think about integrating privacy solutions that protect the user and reshapes the rules for data protection in Web3.
Because privacy in Web3 does matter. Routine “leaks” in Web2 are impossible in Web3 when everything is already publicly available on transparent networks by default. Oasis thinks differently about this. Transparency should be possible, but not the default option. Confidentiality is essential for the widespread adoption and protection of basic digital rights.
Every sensitive technology application must offer users the choice to balance privacy and transparency. Even more important is the need to respect individual rights to data ownership against snooping third parties while complying with all applicable laws and regulations. Unlike single-use “privacy coin” binary assets, Oasis Network achieves all of the above goals. The future of privacy on Web3 begins and ends with the customizable confidentiality of Oasis smart contracts.
