Ethereum News: Developers Push for Wallet-Level Privacy as Core Network Upgrade

The shift was made clear at Devcon, where developers showcased Kohaku, a new privacy framework being built under the guidance of the Ethereum Foundation.

Unlike earlier privacy initiatives built as standalone protocols, Kohaku is structured as a toolkit for developers, allowing privacy capabilities to be embedded directly into wallets and applications. Rather than relying on centralized mixers or custodial solutions, Kohaku offers primitives that can be combined to build privacy-enabled user interfaces.

Demonstration Signals Wallet-Level Privacy Is Coming

During a live demo, a prototype wallet used Kohaku components to shield visible balances using a Railgun integration. The prototype suggests that privacy tools may soon be usable automatically inside mainstream wallets — not separate services.

Developers say the long-term vision includes optional modules for network-level anonymity, ZK-enabled browsing, and mixnet-style routing, although these features are still in development.

Regulatory-Compatible Privacy Tools

The Kohaku repository already includes support for Privacy Pools, a protocol that proves a user’s funds are unlinked to criminal activity. The model uses association lists to exclude sanctioned or malicious actors, addressing compliance concerns that surrounded earlier mixers.

Ethereum Foundation Ramps Up Privacy Research

The Kohaku debut follows a series of internal structural changes that signal where the ecosystem is heading:

• A 47-member Privacy Cluster was formed to make privacy a “first-class property” of Ethereum.
• The Privacy & Scaling Explorations team rebranded to Privacy Stewards of Ethereum, marking a shift away from experimental research toward deployable solutions.

Both groups are now working on features such as confidential DeFi and private governance tools, including zero-knowledge voting.

Why Privacy Is Now a Priority

Ethereum developers say the network has achieved major progress in scalability and efficiency, while privacy has remained comparatively underdeveloped. Kohaku is intended to close that gap and give users the ability to interact on-chain without exposing their financial history or activity patterns to the world.

The initiative reflects a broader belief among Ethereum researchers that mainstream adoption requires privacy that is secure, user-friendly, and compliant — not reliant on high-risk third-party mixers or custodial anonymizing services.

Next Steps

Kohaku remains in active development with no public release timeline. However, the foundation indicated that more updates will follow as modules become production-ready. For developers, the emergence of a unified privacy toolkit could signal the beginning of a new category of Ethereum-native applications built with privacy assumptions rather than privacy add-ons.

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