Starknet rolls out ZK privacy layer for ERC20 balances and transfers

Starknet has launched a new zero-knowledge privacy framework that it says is designed to enable shielded balances and private transfers for any ERC20 asset on its network, while incorporating disclosure mechanisms intended to support regulatory and compliance requirements.

The framework, known as STRK20, allows developers to add private transaction flows without building a separate privacy stack. It can scan support transfers, swaps, lending, staking, payments, and donations, while viewing keys allow only information responsive to legally binding requests to be disclosed, according to a statement shared with The Block.

The Starknet team said the framework is not a mixer. Mixing typically sends assets to a separate destination to obscure transaction history, whereas STRK20 embeds shielding directly into the asset flow. Privacy operates as a native mode of activity rather than a specialist detour, they noted.

"This is practical privacy in the truest sense," Damian Chen, VP of Growth at the Starknet Foundation, said. "It enables users, builders, and institutions to maintain confidentiality from the public while preserving compliance-ready disclosure paths when required by law."

The strkBTC launch gave STRK20 its first major use case, bringing shielded balances and private transfers to bitcoin activity on Starknet, per the statement.

Rather than treating privacy as a separate destination, strkBTC uses STRK20 to make shielding part of the asset experience itself, allowing bitcoin to move between public and private modes through supported Starknet wallets and applications.

Eli Ben-Sasson, CEO of StarkWare, predicted that ZK-powered privacy solutions like STRK20 will lead to more pinpointed regulatory actions over time.

He said current investigations into privacy infrastructure can affect large numbers of wallets and argued that advances in ZK technology could allow future investigations to target specific information with less collateral impact.