Starknet has introduced STRK20, a new token standard designed to provide native privacy to ERC-20 assets on the network, allowing balances and transfers to remain hidden while enabling interoperability with decentralized financial protocols.
The startup aims to address one of the long-standing limitations of public blockchains. Every transaction on a common network exposes the wallet address, amount, counterparty, and timestamp in a permanent public ledger. Although transparency is central to blockchain design, it also prevents businesses and institutions from adopting onchain financial systems.
STRK20 allows any ERC-20 token on Starknet to work with private balances and transfers by default. Instead of relying on wrapped assets or separate privacy layers, the feature is integrated directly at the token level.
The system is built around the Starknet privacy pool. Users deposit tokens into the pool, perform transactions within it individually, and withdraw as needed.
Transfers within the pool do not reveal information about the sender, recipient or amount to outside observers. Each transaction is verified using zero-knowledge proofs, ensuring validity without exposing sensitive information.
The architecture is designed to maintain compatibility with the broader DeFi ecosystem. Starknet said STRK20 tokens will support features such as anonymous swaps and staking from launch.
One of the first will be the integration with the decentralized exchange Ekubo. Users can exchange tokens directly from the privacy pool without linking their wallet address to the business. While the trade’s impact on liquidity pools remains visible, the identity of the trader remains hidden.
The system also allows anonymous staking. Users can exchange liquid tokens and establish staking positions on-chain without exposing their wallet address, reducing the ability of outside observers to track holdings over time.
STRK20 is built on Starknet’s anonymity architecture and the Cairo programming language, allowing private transactions to use the same infrastructure that validates network blocks. Proofs are generated on the client side and verified by the Starknet sequencer.
The system also introduces a compliance mechanism. Users who log into Starknet’s privacy pool record an encrypted viewing key that can be decrypted by a designated auditor if legally required, allowing regulators to track that user’s activity without exposing other participants.
