The Solana Foundation presents a new narrative to large institutions: privacy as a customizable feature, not a compromise.
In a report released Monday by the foundation, “Privacy on Solana: A Full-Spectrum Approach for the Modern Enterprise“, The organization argued that the next phase of crypto adoption will depend less on transparency alone and more on giving companies control over what they reveal – and to whom.
The framework marks a shift from the initial philosophy of cryptography. Public blockchains traditionally emphasize openness, where transactions are visible and traceable, even if users are only represented by wallet addresses. The report acknowledges that this “pseudonym” model, while fundamental, is not suitable for many real-world use cases. Financial institutions, for example, may need to prove that transactions took place without exposing counterparties, while companies that process payroll should avoid disclosing their employees’ salaries.
Underlying this talk is a technical claim: Solana’s speed makes advanced privacy techniques practical. The team argued that the network’s high throughput and low latency allow these methods to operate at near-web speeds, opening the door to use cases such as encrypted order books or private credit risk calculations.
But rather than offering a single privacy solution, the foundation presented privacy as a spectrum made up of four distinct modes: pseudonymity, confidentiality, anonymity, and fully private systems.
At a basic level, pseudonymity keeps identities hidden behind wallet addresses while leaving transaction data visible. Across the spectrum, privacy allows participants to be known while encrypting sensitive information such as balances and transfer amounts.
Anonymity reverses this dynamic, hiding the identity of participants while allowing transaction data to remain visible. At the extreme end are completely private systems, where identities and transaction data are protected through techniques such as zero-knowledge proofs and multi-party computation.
The message is that there is no single model for privacy protection. “For businesses, privacy is a spectrum, not a change,” the report says.
What Solana is trying to do is bring all of these privacy options into one system. Instead of choosing a single approach, businesses can combine tools, such as hiding transaction amounts, proving the validity of something without revealing details, or controlling who can access certain data, depending on their needs.
In practice, this could mean executing trades without revealing the order amount, sharing risk data between banks without exposing individual balance sheets, or allowing users to demonstrate compliance without disclosing personal information.
The report leans heavily on the idea that privacy and regulation can coexist. The team highlighted mechanisms such as “audit keys,” which allow designated parties to decrypt transactions when necessary. Other systems would allow wallets to demonstrate their compliance status without revealing their identity. These features are intended as a response to increasing regulatory scrutiny, particularly regarding anti-money laundering rules and financial supervision.
“Privacy is a market requirement,” the report says. “Customers expect it and applications demand it. On Solana, you choose your level of privacy, from encrypted balances to zero-knowledge anonymity to multi-party confidential computing. Each level corresponds to a compliance path, and each is composable with the broader ecosystem.”
Read more: Solana Foundation’s Liu: Focus on finance, not gaming ‘mishaps’
