Railgun brings privacy tools to decentralized finance

0:01i'm ashton addison from block west capital for investment pitch media and the Crypto Coin Show and today on blockchain interviews with alan scott advisor to the railgun project alan welcome to the show and thank you so much for taking the time yeah i really appreciate being here thank you for having me you're very welcome let's dive straight into defy privacy preserving protocols a

0:24huge topic moving forward as more institutions come into the space more people are looking for privacy from their public blockchains enterprises as well are looking to not show everything that they have on the blockchain and showing all their cards and there's different solutions coming out in the space right now but i know that railgun is working on

0:43something particularly interesting that we are going to dive into today so let's kick it off from you by just getting an overview of the railgun project and then we can dive into those details yeah absolutely so to put it simply railgun is a smart contract system that allows you to do d5 privately and the way they do that is it allows you to take and

1:09put funds into a private balance that is held on the railgun smart contract and then you can use that private balance just like you would with any other wallet to interact with things like uni swap sushi swap yield farms private staking and the like very cool okay so there's a lot to break down in there because there's so many different assets you could be trading

1:32with different blockchains different d5 protocols as you mentioned unit swap and some of these major decentralized exchanges make sense that those would be applicable for this are there any limitations with this can you take bitcoin or ethereum and just move it to railgun yeah so we're actually working with the folks over at ren labs to be able to

1:55take in rap red btc directly into a private balance so yeah it'll be really really exciting for people who want to take and privatize their bitcoin and use d5 with that bitcoin in terms of the i guess the limitations are really the sky's the limit i think we built i was really trying to find something there but i think you know in terms of

2:21like the anonymity set you know it's really important to take and build tvl and activity out of the smart contract i think this is really important and we're going to do that by way of the sdk that's been developed so we have a developer kit that is it's really easy to use so the integrations for people who are d5 builders in the space will be really

2:41quite easy and we're really excited about that very cool that's great to know and with moving bitcoin or ethereum for example into railgun normally every bitcoin transaction is perfectly transparent on the bitcoin blockchain and ethereum the same as well maybe you can talk about how does adding in railgun preserve privacy

3:08and does it change the block explorer for those assets so this is interesting so yeah i guess a bit of color a lot of people are really quite surprised if they're new to the space that crypto is really quite public in fact i mean ethereum is a public ledger blockchain right evm is just that right so whenever you're transacting on not just ethereum but you know bitcoin or

3:33polygon or binance smart chain solana the list goes on right all of these things have block explorers that you know basically take and distill down all this information it allows people to take and track transactions and verify them right and it used to be that like the pseudo-anonymous nature of your address like on ethereum was enough to take it

3:55you know perhaps at least obfuscate who you are as a person but now as adoption has increased and like transactions and daily transactions are just you know going to the moon and more users are coming into the space it's starting to become clear that you know heuristics alone can take and you know identify which you know when it comes to your financial data perhaps

4:18really isn't desirable even on an individual level so you can think for example if you were to go to dunkin donuts or something like this and swipe your debit card or swipe your credit card and then the you know everyone who attended that dunkin donuts and the corporation dunkin donuts and the person who took your order all have access to your financial data you would probably

4:37find that to be a real egregious breach of your privacy right and people would be you know they should know that this happens in crypto right in fact there's you know really large players in the space like chain alice's and nansen who are you know applying ai and a lot of different techniques to the blockchain space in order to take and collect collate and then sell your financial

5:03data now what railgun does is it's basically in stark opposition of this right and it allows you to take and self-adjudicate who has access to your financial data so if you want to take and send usd privately or if you want to excuse me usdt you want to send any other stables privately you can do that with railgun and not not dox yourself that's incredible

5:31yeah so then you asked on the on the blockchain explorer what that would look like which is always a an interesting thought so if you have funds in the railgun smart contract system and let's say i send it to you and you're in railgun the only thing that you would see like out of the

5:58i guess the black hole of liquidity that railgun creates you would just see that money came out of the smart contract but you don't know who from and from what balance or anything like that which is you know protecting that person's privacy as they're acting definitely that's good to know and is this you know whenever there's privacy preserving protocols that come out

6:22there's always some media or actors that are like this is just to help criminals or this is just to help people that are trying to hide something do you see that as the case or and if so or if not are you particularly catering this to institutions enterprises or individuals or is this really for everybody yes so the privacy for bad actors straw man is definitely

6:51Frequently brought up right and i think that's a bit disingenuous because most people understand that privacy is a human right and you know take for example your medical records you wouldn't want everybody to have access to your medical records in fact if you were to take and pay let's say a lawyer for their services right you would want that to take and be

7:14private and in fact you know your lawyer as your legal representative you know legal representative you know has to actually do that by law right they're supposed to you know keep things privileged but even just something as simple as like we talked about i mean imagine a world where you're at you know some vendor if you go to target or walmart or trader joe's or whatever it

7:35may be in your neck of the woods and you swipe your card and then they have access to your entire financial data you know history current balances and then can track you into the future like this would be very very egregious overstep against people's you know personal financial privacy right i think people really value personal financial privacy in fact i

7:56think that's why we have so many anons on like crypto twitter right they don't want people to be able to just track them as a person and i completely respect that i believe everyone has something to hide right i believe that's particularly true when it comes to your financial information in terms of who we're catering to i guess it could be anybody who wants to

8:19take and transact and defy and do that in a private and anonymous fashion and this does tend to appeal to the larger whales and institutional buyers you know if you're gonna take and get into a 18 million dollar position of some token or you know develop some new farming strategy you're probably going to want to do that in a private fashion and so

8:43Yeah we're definitely gearing it towards those people yeah that makes sense and thank you for clarifying about the retail stores yet it really does show a lot of information on you know bitcoin blockchain for example and people can see that information moving forward to the future and even if you don't have anything to hide you know it's not good to be showing your bank account

9:06balance to every single person that you transact with so that does make sense so even on like the like your use cases from like a trader's standpoint if you have like a new a new position that you want to get into that you're speculating on or if you have like a sophisticated farming strategy or if you have clients right who are tracking your wallet your every

9:29move as a trader right anyone who can relate to this right not every trade is a home run right and just having your your track record on chain for the rest of forever can be a bad thing right it could lead to a lot of a lot of negative outlooks and i think too i'll give you a great example as you may or may not know we had a strategic partnership that was

9:54initiated with dcg and you know one of the things that they did to partner with the railgun dao is put 7.5 million dollars worth of dye into the treasury right so in exchange for some tokens that the dow voted submit for them well what was really interesting about that is our community you know when we did this it was actually like private you know it

10:20was pseudo anonymous it was fund x that we had that we're going to do a partnership with well it took the community just over two hours to figure out that it was dcg just a little bit of chain you know block exploring clicking on ether scan found out who it was and you know you know kind of forced the hand for us to you know go public with it of course

10:41which was you know not necessarily a bad thing you know it's really awesome to have a private excuse me a partnership with dcg they're really great big players the epicenter of all things crypto but you could see like from dcg's perspective perhaps if they wanted to keep it private for a little bit longer they weren't able to do so because

11:01on-chain analytics completely docks them whereas if they were you know able to do that with some railgun privacy technology would not have been the case definitely and that is amazing congratulations on having such a big partnership dcg are literally one of the biggest players in the space right now if not the biggest so congratulations on that and

11:27maybe that's a sign of moving forward you know there's been a huge growth in d5 and i'd love to know your insights on when do you think privacy preserving protocols for d5 specifically are gonna be like one of the main if they will be one of the main topics that people start talking about because it seems like there's a lot of great solutions like this coming out

11:53but it's not as you know obviously not as popular as nfts or just d5 in general right now yeah i think that as the market grows more and more aware of just how not private it is i think that this will be when people really start to care about privacy but we can already see that there's a lot of different a lot of different players in the space who are really excited

12:18about privacy especially on like the trader side on the institutional side you know there's capital sitting on the sidelines that wants to participate in d5 but chooses not to because it's not secure and it's not private they're used to you know traditional finance where they can participate in a dark pool and be able to do large block trading in a private fashion without upsetting the

12:38market and i think that this will be something that will be really important going forward for these institutional players who want to get into d5 but then i also think on the individual level you know people really desire financial privacy and as more and more on-chain analytics get i guess more pervasive i think that people will start to see that the tech is really really

13:00important but you know we're starting to see glimpses of that now i think like coin desk did a kind of like a privacy week i think they did a lot of different articles just very recently about privacy talking about like on-chain analytics and like different ways to take and maintain your privacy in the space we're starting to see like zero knowledge is a huge trend in the space

13:24and a lot of that tech is utilized in privacy preserving protocols so i think people will learn about it if they're just interested in you know zero knowledge technology but i would say that probably 2022 is the year of pri 5 you know private d5 i like that and i really haven't heard that acronym before as well pri phi i like it i think that's gonna be

13:47you know for retail traders especially as you mentioned you know i did see that in coindesk that they were talking about different ways to help your privacy and i think that's just awareness people don't understand that so much of their information is public and to make it worse you know these analytic companies are profiting from that and selling your

14:08information and that's what you don't want yeah you know it's one thing you know it's totally it's one thing for somebody like facebook to take and you know market to you by way of you know you being interested in some i forget what it was i was looking at some sort of like coffee i think it was like four sigmatic shout outs guys ordered some of your stuff but

14:32as you know it's like some sort of like mushroom coffee i don't know what it is but it looked trendy and i'd have a go at it and you know immediately after searching for it i started to get all these targeted ads and stuff like that but it's totally something different for someone to take and have public access to your financial data and then take and

14:49target you for anything right or judge you whether or not your credit worthy based on like your public address like this i think it's just not good definitely and yeah that's why solution like this is necessary especially for retail traders that they don't really have all of that information at hand to understand what's happening to their own information

15:11behind their backs and when they don't know it so for those people are they available to start using railgun right now yeah so we actually have it deployed currently on ethereum polygon binance smart chain and then if you just want to test the tech out you can also do that on roxton the test net and do that for completely free but currently yes the beta is out and we are

15:37looking forward to the v1 release we're currently doing a security on it with the folks over at trailer bits we take it very very seriously security making sure phones are safe food is very very important to us so we've done a ton of audits we've had one with abdk or multiple with abdk we've done one with sokyo and now we're doing one of the trailer bits and once that's real you

15:58know finished we will do our v1 launch which will be complete with the relayer network to privatize the gas and you will have you know the full v1 launch will come with the applications we're actually developing a mobile application as well there's one being developed that uses railgun tech so you can actually take and have a wallet that has into i

16:24guess built into the front end interface for the user in incognito mode so they can take and use the railgun tech and do it privately by way of the application that's being developed for android and iphone amazing alan very cool about the mobile app and about the v1 launch i'll definitely be looking forward to that and we should definitely follow up

16:47after that as well to see how the continued growth of railgun is going for the viewers that wanna get involved right now and follow along with the community updates as you head towards the v1 launch what is the best way for them to stay on top of it and to get involved in the community yeah so i think there's three great places to get information about railgun

17:10The railgun medium is really great there's a lot of detailed articles that go into you know how the privacy works it talks about all the updates we have a weekly update that's published up there to let people know where development is and what we're working on at any given time but then we also have a telegram called church of railgun quite fun a lot of really involved

17:32community members there i think we have 3 500 or so people at the time we're recording this and you know everyone's there very eager to help people learn and understand more about railgun the community is really bright fun to be around and then last but not least i'd say to you know follow us on twitter because you know we'll leak a lot of alpha there about various snapshots and

17:53things that we're doing to you know incentivize people who are staking the rail token very cool amazing thank you so much alan for coming on explaining all of this to everybody and to me i appreciate you taking the time out of the busy auditing schedule that you're working on towards v1 and you guys are doing a great job so congratulations again on the dcg

18:15partnership everything so far it looks good let's definitely follow up in the near future yeah absolutely thanks for having me on man i appreciate it you