Confidential digital assets and private (permissioned) blockchains both keep business activity off the public record, but they make opposite trade-offs. A private chain achieves privacy by walling off the entire network — only approved participants can see or join it — which sacrifices the liquidity, reach, interoperability, and neutrality of public networks. Confidential digital assets keep settlement on public, EVM-compatible chains and instead encrypt the sensitive values, so activity is private while the asset still lives on open infrastructure.Documentation Index
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Two ways to get privacy
- Private chain: move to a separate, permissioned network. Privacy comes from restricting who is on the network. You give up public liquidity and interoperability, and you take on the cost of running or trusting a closed network.
- Confidential asset: stay on a public chain, but encrypt balances and amounts and prove validity with zero-knowledge proofs. Privacy comes from what is visible, not from who is allowed in.
Side-by-side comparison
| Dimension | Private / permissioned chain | Confidential digital asset |
|---|---|---|
| Where it settles | Closed, permissioned network | Public EVM-compatible chains |
| Source of privacy | Restricted network membership | Encrypted state + ZK proofs |
| Liquidity & interoperability | Limited to the network | Public-chain reach |
| Counterparty reach | Only network members | Anyone with a confidential account |
| Operational burden | Run/trust a network and its validators | Managed by the platform |
| Disclosure to regulators | Network-operator dependent | Selective disclosure by policy |
| Neutrality / censorship resistance | Lower | Public-chain properties |
When each makes sense
Private chains can suit fully closed consortia that never need public-chain liquidity or external counterparties. But for most enterprise use — treasury, stablecoins, B2B settlement, tokenized assets — the goal is the reach and settlement guarantees of public chains without the exposure. Confidential digital assets deliver that combination; private chains force a choice between privacy and reach.Related
- Why enterprises need privacy onchain
- How confidential assets work
- Confidential assets vs privacy coins
- What are confidential digital assets?
FAQ
Why not just use a private or permissioned chain?
Why not just use a private or permissioned chain?
Private chains sacrifice the reach, liquidity, and interoperability of public networks. Confidential digital assets keep public-chain settlement while making activity private and disclosable by policy.
Do confidential assets give up any privacy by staying on a public chain?
Do confidential assets give up any privacy by staying on a public chain?
Balances and amounts are encrypted and counterparties are not exposed, so the sensitive data is protected. What you keep is the public chain’s liquidity, neutrality, and reach.