nandan on Nostr: Confidential transfers on the XRP Ledger, XLS-96, are confidentiality from the ...

Confidential transfers on the XRP Ledger, XLS-96, are confidentiality from the public, not from the issuer. I ran them on Devnet with a small invoice-finance example to find exactly what they hide: amounts, not relationships.

Hidden from the public: each holder's balance, and the amount of each transfer between confidential balances.

Public: who pays whom, when and how often; every amount moved into or out of confidential form; and some zero balances, which anyone can recompute from public inputs. I matched that fixed encryption of zero byte for byte against live Devnet state.

The token's issuer reads every balance, always, and no setting turns that off. If the token allows clawback, the issuer can destroy a confidential balance, and if it allows locking, freeze one. The issuer can switch either on later, unless it has made that setting unchangeable.

Keys cannot be rotated or recovered, in XLS-96 or, as I write this, on Mainnet, Testnet or Devnet. A draft standard, XLS-99, would add both; those three networks do not know it yet.

I am running the same study on EVM chains. Those results will follow.

A research project on Devnet, not audited and not production-ready. Eleven issues went upstream; five are resolved so far.

Write-up: https://nandan.me/writing/amounts-not-relationships/
Code: https://github.com/nandanito/xrpl-confidential-positions

#XRPL #DigitalAssets #privacy