Bringing Privacy to Bitcoin

Bringing privacy to Bitcoin.

​

Let's talk Bitcoin. Bitcoin is the most sovereign money ever created, and yet it is the least private money most people have ever used. For the last 15 years, I thought this contradiction was worth it. I told myself the transparency was why Bitcoin was so trustworthy, that it was a feature, not a bug. But then people started showing up at the front door, and my mind changed.

​

Last month in France, a man was woken up at 7 a.m. by four assailants in ski masks. It was a Monday morning. They tied him up. They beat him. They abducted his wife, and they took his 11-year-old son. They demanded €400,000 worth of Bitcoin. He is okay. The police found his family. But what stuck with me from the story was not the violence. It was the precision.

​

They knew exactly where he lived. They knew exactly what his home layout was like. They knew about his family. They knew how much Bitcoin he had, and they knew which wallet addresses he held those bitcoin in.

​

I wish I could say this is rare, but it is not. Two months ago, a report showed an increase in wrench attacks, a term specifically created to describe attacks against crypto holders, by 75% in 2025. This year, there have been 41 crypto-linked kidnappings in France since January. That is one every two and a half days.

​

This trend is only going to continue. You see stories like the Ledger co-founder being abducted and his finger being severed. Stories like the 28-year-old man in New York City who was held in a basement as his abductors threw parties and threatened to chop off his limbs with chainsaws. Parents are being kidnapped and used as leverage. Associates and friends are being taken and tortured.

​

All of these are symptomatic of a broader trend, and that trend is going up and to the right. It is an increase in physical attacks, an increase in targeted physical attacks against crypto holders.

​

Now, why am I telling you this? I am not just trying to fearmonger. I still believe in Bitcoin's transparency. But the world has changed since 2008, and what was built as a feature has now become a map. And that map is getting easier to read every single day.

​

You are not as private as you think you are. A decade ago, connecting pseudonymous activity to a real person took a team of specialists, and it took this team time, money, and expertise. Even then, there was no guarantee. Today, an LLM can connect a pseudonymous online profile with a real identity within a few seconds. It can do so at 90% precision, and it can do it for less than a few dollars.

​

It has all the data it needs to do this. There are over 18 million crypto user records available for sale on the dark web today. There are corrupt government officials selling tax filing information to criminal organizations, and almost every major company in our industry has faced some sort of data breach: Ledger, Binance, Coinbase, Gemini, FTX, BlockFi, Robinhood.

​

All of these leaks contain personal information, information that can hurt you: names, emails, addresses, dates of birth, withdrawal history, transaction history, everything someone who is looking for you can use against you.

​

And all of this is happening against the backdrop of the tools getting better and the attackers becoming more motivated. The income inequality gap in the U.S. is the largest it has ever been in history, and the stakes have gotten bigger. Bitcoin hit its all-time high in October last year.

​

What I am trying to tell you is: this is what it looks like today. What is it going to look like tomorrow?

​

You are not as private as you think you are, and your options for privacy are broken.

​

If you want privacy for your Bitcoin today, and you want to break that on-chain link between your known address and who you are, what do you have? You have privacy coins. You have centralized exchanges. And you have mixers.

​

Privacy coins are things like Zcash or Monero. They are great technology, but they require you to sell your Bitcoin and hold a different asset. That is not really privacy. That is selling your Bitcoin.

​

Then you have centralized exchanges. I am sure everyone is familiar with the flow. You have bitcoin, you send it to an exchange, you wait, and you withdraw it to a new wallet. That new wallet has no transaction history, and to you it seems private. But is it really private? In the course of doing that, you gave them your KYC, you gave them custody, and they have records of all your internal transactions. It is really just obfuscation with additional counterparty risk.

​

Finally, you have mixers. I would not endorse them. They may give you privacy, but they also put your hand up for surveillance. Your funds get flagged. You may be private, but you are marked.

​

So just to recap, your options are: sell your Bitcoin, trust an exchange, use a sanctioned mixer, or do nothing and stay exposed. These options are not good enough, and they are not good enough in the era we are in.

​

So what is the answer? The answer is math. It is bringing it back to Bitcoin's roots.

​

In 2013, Eli Ben-Sasson gave this talk at the first Bitcoin conference in San Jose. He talked about proving something is true without revealing the thing itself. That became the foundation of what you and I know as zero knowledge in our industry. It became Zcash, where he was a co-founding scientist. It became StarkWare, where he is the CEO and founder. It became Starknet, the public network.

​

Now that work is coming back to Bitcoin. This is the moment I have been building toward. This is the solution that we are bringing to market to break the on-chain link between you and your Bitcoin. I am excited to announce stBTC.

​

stBTC is private Bitcoin on Starknet, available in two weeks.

​

I will tell you a little bit about what this is. stBTC is wrapped Bitcoin on Starknet that is fully backed one-to-one by Bitcoin on the Bitcoin network. You bridge it into Starknet, and the bridge is governed by a federation multisig of some of the highest-integrity actors within our space, including Twinstake and Luganodes.

​

All stBTC that arrives on Starknet enters what we are calling the privacy pool. Any activity within this privacy pool is fully private from the public blockchain. This includes transactions, transfers, and swaps. Once you are ready, you can bridge your stBTC back to Bitcoin, and you can bridge it to one address or 100 addresses. It is up to you.

​

On Bitcoin, if someone is monitoring your address, the only thing they see is a transaction into the bridge. On Starknet, everyone else sees nothing. When you bridge it back to Bitcoin, the only thing that shows in your new Bitcoin wallet is the receiving transaction from the bridge into the new wallet.

​

All of this is powered by cryptography. As a user, when you deposit assets into the privacy pool or use assets in the privacy pool, you generate a cryptographic note. That note tells the pool, I have put these assets in this pool, and I can verify it.

​

When you want to use your assets in this pool, you produce that same note. The pool verifies that you do indeed have access to those assets, and it fulfills those transactions. On withdrawal, the same thing happens. Either you or the person you sent the assets to produces a cryptographic note. That cryptographic note gets verified by the privacy pool, and the privacy pool fulfills the withdrawal to the address you nominate.

​

As the user, you see the entire journey. But from the outside, they see nothing.

​

The best part about this is that it is fully verified and backed by math. There is no trust. There is no intermediary. It is also fully compliant. We have third-party screening going into the pool, which means no assets will be co-mingled with proceeds of crime or sanctioned assets. The user at all times holds a viewing key that can decrypt their transactions. They can produce this viewing key to tax authorities, to law enforcement, or to whoever they want, and that viewing key can be used to decrypt the transactions they have made.

​

Now, I know what you are thinking. You are thinking, Damian, this is not real Bitcoin. It is a trusted Bitcoin asset. And you would be right. In an industry where trust assumptions are hidden behind marketing and things are hidden in terms and conditions, I will be the first to tell you that this is a trusted Bitcoin wrapper.

​

But before I tell you how we are planning to make this no longer trusted, I want to first remind you of the industry we are in. I want to zoom out and remind you about the Ledger co-founder, about the 28-year-old man in New York City who was abducted, about the parents being taken, about the friends and associates being targeted for leverage. I want to remind you of the speed of AI, the corrupt officials putting you and your family at risk, and the scale of the data leaks within our industry that expose you.

​

You are right. stBTC is a trusted Bitcoin wrapper. But you know what else it is? It is real. It works today, and it gives Bitcoiners real privacy. It gives them a real, functional, compliant way to break the on-chain link between who they are and what they hold. It gives it to you in an era where having that could be the difference between life and death.

​

Now, the job is not finished. stBTC has two explicit goals. We want to make it trustless. While it starts off as a federation today, tomorrow, when it is commercially feasible, it will be a one-of-n BitVM implementation. Then the end goal is Bitcoin-native verification, a fully trustless bridge enabled by STARK verification after OP_CAT is enabled.

​

But I am actually much more excited to tell you about our second goal. We want stBTC to be the solution for all of the problems facing Bitcoin, not just privacy.

​

Bitcoin's biggest threat is quantum. Three weeks ago, our head of research published a paper that got 1.8 million views. In this paper, he details a production-ready, usable method for safe post-quantum Bitcoin transactions today, without any soft forks, without any core protocol upgrades.

​

What I want to leave you with is this: stBTC is your new best way to anonymize your Bitcoin, to break that link on-chain between your identity and what you hold. Tomorrow, stBTC could also be your safe haven against a quantum attack. I cannot say more about this at the moment, but it is exciting, and it is what we are actively working toward as the immediate next thing.

​

In closing, 15 years ago someone asked Satoshi what his thoughts on zero knowledge proofs were, and Satoshi replied that it was a very interesting topic. If a solution was found, a much better implementation of Bitcoin would be possible.

​

That took a while, but that solution is here. It is stBTC. It is private Bitcoin. It is on Starknet, and it is live on May 12.

​

That is it. Thank you very much for listening. I am Damian. I am the VP of Growth at the Starknet Foundation. If you are doing anything on Bitcoin today, the one thing I will ask you is to see if you can do it better with stBTC. You do not need to stop what you are doing, but you can replace it or add it as part of your workflow.

​

Give your clients, give your loved ones, and give yourselves an anonymous Bitcoin alternative. You can reach me on Telegram and on X. Thank you very much, and I hope you have a great rest of the evening.