Anonymity staking - Introducing Hinkal's "Eigenlayer for Privacy"

Introduction:

EigenLayer’s introduction of restaking technology has revolutionized DeFi, allowing users to increase the rewards from their staked assets while contributing to securing the ecosystem. Since then, multiple coordination layers and (re)staking protocols emerged, widening the range of repurposed tokens and further strengthening the ecosystem.

However, restaking has been constrained to AVS security, actually becoming the race to 0% yield that stakers can gain. Eigen’s restaking model introduced a unique framework that can be expanded to enable one more primitive to finally take off. We are happy to introduce Hinkal Shared Privacy coordination layer.

Hinkal’s “Shared Privacy” framework expands the repurposing value of assets, by enabling scaling privacy horizontally for all networks and thus enabling mass adoption of blockchains with the core built-in primitive - privacy. Let's explore how this is achieved.

What is Restaking?

With restaking you are extending the utility of your staked tokens and positions for further usage. EigenLayer has unlocked the coordination framework repurposing of staked tokens to provide crypto economic security to protocols. Restakers benefit from further yields while they provide the required capital, thus contributing to the ecosystem, while they stay liquid with their LRT tokens.  

Repurposing to Secure Shared Privacy

Hinkal introduces Shared Privacy coordination layer, enabling users to bootstrap Shielded pool similarly to how EigenLayer enabled to bootstrap Shared security. Stakers will be able to restake their ERC-20 tokens to increase the Shielded pool, responsible for providing privacy for all chains at once. In return, stakers receive hERC-20 tokens back, which enable them to receive additional fees from private transactions while remaining liquid for further use in DeFi. One shielded pool can be used across all chains therefore solving the problem of scalability of privacy via removing fragmentation. This can be achieved with chain abstraction solutions as well as native bridges. 

Institutional and individual users can leverage Hinkal’s Shielded Pool to store assets and execute transactions across multiple networks and major dApps, enabling them to operate efficiently in DeFi markets without compromising on privacy or compliance. Designed to prevent illicit parties from using the protocol, Hinkal mirrors the secure and confidential execution environment of TradFi.

How it works

Hinkal aims to solve the issue of fragmented liquidity of Privacy Pools by Chain Abstraction. Instead of striving to build Shielded Pools large enough to provide any privacy coverage per network, Hinkal introduces the Shared Privacy Pool covering all networks. Deposited and Staked assets that increase the Shielded Pool, all reside in the same network, magnifying the privacy of assets.

Users can deposit any ERC-20 and BEP-20 tokens as deposits, which can be used for swapping, staking, yield-farming, and yield trading confidentially, or be withdrawn with no reference to the original deposit address. Each user holds a shielded address where tokens are stored after depositing. By Introducing an abstraction level to the Shared Privacy Pool, Hinkal provides privacy across networks for any dApps, creating a private and secure ecosystem. Staking is permissionless, while users are required to pass an Integrity Check. This ensures no individuals or funds from sanctioned lists can benefit from the protocol’s services.

Stakers are incentivized to contribute to building the shielded pool while remaining liquid. They can stake ERC-20 tokens directly from their public wallet or shielded address and receive hERC-20 tokens at a specified public wallet or shielded address. This modularity aims to give contributors the option to choose whether they want to benefit from Hinkal’s privacy services while remaining liquid. 

A flourishing ecosystem

For Hinkal, restaking for the sake of Shared Privacy is more than just a step forward; it's a leap toward a more private, secure, and inclusive DeFi ecosystem. It is our view that ensuring an ultimately discreet execution environment, we are able to enable further adoption of blockchains for institutions, RWAs and whales. With this in mind, we are incentivizing the participation of every independent entity to help us grow this private ecosystem. Users, Stakers, Protocols, Strategy Curators, and Independent Relayers are all welcome to play a role in expanding and decentralizing Hinkal’s services cross-chain.

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