Secret Network is a blockchain that provides the framework for privacy-preserving smart contracts and support for dApps that allow more privacy than currently exists in other networks where most information is publicly available.
The network was created by Enigma, which raised $45m in it’s 2017 ICO. This eventually allowed holders of Enigma’s ENG token to trade 1:1 for SCRT, the native coin of the network. The network itself is built atop the Cosmos/Tendermint framework. It utilizes nodes to perform the computation needed for the smart contracts but the nodes, in turn, utilize a Trusted Execution Environment (TEE) to keep the information private.
What does Secret Network aim to fix?
Blockchains and DeFi networks, while they are powerful tools, suffer from information being publicly available which can raise concerns for people looking to keep their sensitive info private. With wallet addresses, transactions, and holdings being publicly available there is a possibility that this information could be tied to a real-world identity which poses security risks and makes some heavy hitters a target for malicious activity.
Privacy has become a topic of discussion as of late as people become more aware of the risks associated with using certain platforms. For example, most large tech companies will sell the personal or browsing data they collect from you to advertisers. While this is not inherently malicious, it does raise concerns for what else may be happening with our data. These companies holding data also pose the risk of a security breach and that data falling into the hands of hackers with less than good intentions.
These privacy concerns are something that many projects, both crypto and otherwise, hope to address. DuckDuckGo or Presearch for search engines, Brave for browsers, Protonmail for email are all examples. But there isn’t much in the way of privacy-focused smart contracts, so this is where Secret Network steps in.
How does Secret Network achieve this?
Using blockchain inherently creates a decentralized network with no one entity in total control, the first step to privacy and safety. To build on top of that it provides programmable privacy which expands blockchain privacy beyond just obscuring the sender or receiver of transactions. It allows apps built on the network to utilize encrypted inputs and outputs, and encrypted state in their smart contracts. More info on programmable privacy can be found here.
An example from the developers themselves brings light to a flaw in the DeFi lending scene. In order to qualify for a loan, the smart contract will look at holdings and previous transactions to verify eligibility. This isn’t a problem on its own, but it becomes a problem when all of the data collected by it is publicly available and puts your finances out in the open.
This is a very specific example, but I think it showcases one of the major flaws in the system as it currently is and helps visualize ways the network can improve the process.
What is SecretSwap?
February 17 marked the launch of SecretSwap, which exists on the Secret Network mainnet. It marked the first launch of an Automated Market Maker (AMM) in the ecosystem and promises a private DeFi experience.
Secret tokens (SCRT) are the inherently private native tokens of the network and can represent virtually any asset to include Ethereum assets (through the use of their Secret Ethereum Bridge). Network fees on SecretSwap are paid for in SCRT and tokens purchased on it can be transferred on the network, used in Secret Apps, or sent back to their native chains via bridges. As the ecosystem’s bridges grow, the network will progressively become a larger private and cross-chain hub.
Functionally, the platform works much like UniSwap or any of the other Ethereum DeFi platforms but promises significantly cheaper transactions alongside the additional privacy. It integrates with the Keplr wallet to facilitate the transactions within the platform. Metamask support is also available for the Ethereum Bridge. For a quick rundown of how to use the platform, they have a blog post here.
The genesis date for SEFI, the native governance token for Secret DeFi, is currently slated for March 31st as announced here. Work is still being done on the recently announced Binance Smart Chain Bridge which will bring privacy to BSC tokens.
I think privacy is only going to become more important as blockchain adoption grows and it’s refreshing to see a project focusing entirely on protecting it. My little experience with SecretSwap has shown some promise so far and I’m excited to see how it grows with new bridges and features. I think Secret Network will be very important in the future and I hope to see more people adopt it so we can support a more private blockchain.
