Researchers have developed Shielded Bitcoin, a technology for private BTC transactions that conceals the sender, recipient, and transaction amount. These operations may cost about four times more than standard transactions.

Privacy on L1 and zero-knowledge proofs

The key feature of this solution is that private transfers do not require a Bitcoin network fork. Privacy is achieved on the existing L1 using zero-knowledge proofs. The approach is described in the Shielded Bitcoin project.

Targeting Zcash-level privacy

The initiative aims to provide BTC transfers with privacy comparable to Zcash (ZEC) practices, while remaining compatible with the current Bitcoin protocol and requiring no consensus changes.

Experimental development status

The technology is at an experimental stage. The authors acknowledge that private transactions may incur higher costs compared to regular ones.