Приватные решения становятся ключевым элементом для институциональных инвесторов, утверждает CEO Matter Labs Translation: Private solutions are becoming a key element for institutional investors, claims CEO of Matter Labs.

The rising popularity of privacy tools is driven not just by retail users but also by interest from institutional players. This was stated by Alex Glukhovski, the CEO of Matter Labs, which develops the ZKsync Layer 2 solution, in a conversation with Cointelegraph.

According to him, banks and corporations are in need of zero-knowledge proof (ZK) solutions for operating within public blockchains.

The expert identified two forms of privacy: cryptopunk-level privacy for accounts and institutional-level privacy for systems.

_»Corporations require complete control over their data flows, keeping them hidden from everyone else,»_ he explained.

Glukhovski believes the growth of the crypto market among retail users has stalled. This phase was characterized by speculative trends lacking real-world applications.

_»For a long time, the crypto industry had a strange obsession with unproductive assets, which was clearly unsustainable,»_ he remarked, calling meme coins «purely speculative chips in a casino.»

The situation has altered due to regulators’ attitudes. In the past, exchanges delisted privacy coins, and U.S. authorities imposed sanctions against services like Tornado Cash. Now, however, the approach has become more selective. Glukhovski pointed out that regulators have begun to differentiate privacy technology from its illegal usage.

_»It’s like day and night. Previously, no one wanted to touch cryptography — it was a taboo subject. Now the attitude is more like, ‘We need to adopt the technology, or we will lose in the competitive race,'»_ he added.

Glukhovski stated that institutions do not require the same model of privacy as consumers. Instead, they need a private execution environment where they see all their operations while the outside world sees nothing.

Previous experiments with corporate blockchains like Hyperledger or Corda did not address the issue, as they remained isolated from public capital markets.

The solution lies in combining locally managed private networks with ZK proofs. This approach will allow companies to keep transaction data internally while proving the validity of operations to the public network without disclosing specifics. The registry does not see the particulars of the transaction but can verify that the rules are not breached.

Glukhovski noted that the recent surge in activity around ZKsync is not due to retail speculation but rather interest following the announcement of new tokenomics and ZK staking.

The protocol is now positioned as a network of multiple blockchains, including those managed by financial firms. Glukhovski anticipates the first operational implementations of such systems by the end of the year.

As a reminder, in October, the ZKsync team introduced the Atlas update for the ZK Stack, aimed at accelerating and simplifying the transition of companies and institutions to blockchain technology.