The Ethereum Foundation announced Wednesday the formation of a 47-member Privacy Cluster coordinated by Blockscout founder, Igor Barinov.
The initiative expands on efforts dating back to 2018 through the Privacy and Scaling Explorations team, which has built over 50 open-source research projects and released key primitives, including Semaphore for anonymous signaling, MACI for private voting, and zkEmail.
Five-Track Strategy Targets Surveillance Vulnerabilities
The cluster unites top researchers, engineers, and cryptographers to tackle five key areas.
These areas include private reads and writes for seamless payments and interactions without surveillance, private proving for portable verification, private identities through selective disclosure, privacy experience improvements, and institutional adoption through a dedicated task force.
The foundation is also developing Kohaku, a privacy-preserving wallet and open-source SDK designed to make strong cryptography accessible for mainstream users.
The move follows a September rebrand of the Privacy and Scaling Explorations team to Privacy Stewards for Ethereum, which shifted focus from cryptography exploration to problem-first solutions addressing surveillance vulnerabilities.
That transformation introduced a roadmap warning that without robust privacy protections, Ethereum risks becoming “the backbone of global surveillance rather than global freedom.”
The team emphasized that institutions and users would migrate elsewhere if private transactions, identity, and data remain compromised by public blockchain transparency.
Ethereum co-founder Vitalik Buterin laid the philosophical groundwork for this expansion in April when he published “Why I Support Privacy,” urging the Web3 community to treat privacy as essential to decentralization amid growing concerns over AI-driven surveillance and data misuse.
Buterin argued that information is power, and when centralized, it risks distorting democratic balance.
Just days before then, he released an accompanying roadmap on April 11 outlining four areas for enhancing privacy, including anonymous payments, application-level privacy, secure data access, and network obfuscation.
From Philosophy to Protocol Implementation
Buterin’s roadmap called for Ethereum wallets to integrate tools like Railgun and Privacy Pools to create “shielded balances” enabling private-by-default transactions.
He advocated generating unique addresses per dApp to eliminate traceable links between applications while supporting standards like FOCIL and EIP-7701 to reduce reliance on public transaction relays.
The proposal offered a structured path requiring minimal changes to Ethereum’s Layer-1 consensus, promising near-term benefits without overhauling the network’s core.
The urgency also stems from warnings by industry veterans like Petro Golovko of British Gold Trust, who argued in an August interview with Cryptonews that public blockchains expose salaries, business deals, and balance sheets, making crypto “unusable for regular people and impossible for institutions.”
Golovko compared current blockchain transparency to the pre-SSL internet when users refused to enter credit card numbers due to a lack of encryption, maintaining that crypto remains stuck in this vulnerable phase.
European regulatory pressure adds another layer of urgency.
In June, Ethereum community member Eugenio Reggianini outlined GDPR compliance practices requiring personal data to remain off-chain, with blockchain nodes relaying only encrypted references or proofs rather than identifiable information.
The proposal called for assigning data controller status to front-end actors like wallets and dApps while lower-layer infrastructure processes only anonymized data.
Building the Infrastructure for Mass Adoption
The Institutional Privacy Task Force, launched in collaboration with the EF EcoDev Enterprise team, specifically targets adoption blockers by translating regulatory and operational requirements into privacy specifications and proof-of-concepts across real-world assets, funds, payments, trading, and compliance.
This addresses concerns that no board will approve systems exposing supply chains or financial operations globally, limiting crypto to speculation rather than serious commerce.
Projects are already implementing advanced solutions.
Aster, a multi-chain decentralized exchange, uses zero-knowledge proofs to separate order intent from execution, keeping trade details confidential while ensuring settlement transparency.
The platform employs a multi-node order book to prevent front-running and MEV attacks, enabling fast self-custodial trading with privacy at the core.
The foundation’s commitment extends across the full stack from cutting-edge cryptography and institutional pilots to everyday user experience, aiming to complement the hundreds of privacy projects already operating across the crypto ecosystem.
PSE continues as a team focused on early research and development under Andy’s leadership, while new privacy-related projects form under the expanded cluster structure.
The foundation emphasized that privacy deserves to be a “first-class property” of the Ethereum ecosystem for individuals and institutions alike.
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