Vision
Dec 4th, 2021
## min read

Confidential transactions have arrived, a dive into the AZTEC Protocol

Aztec is revolutionizing private transactions on the blockchain, and this is how we're doing it.

Share
Written by
Zac Williamson
Edited by

Transaction privacy is a fundamental requirement for many kinds of financial services, and the inability to provide this privacy has prevented Ethereum from providing compelling alternatives to traditional financial instruments. There are several blockchains and blockchain projects that use cryptographic techniques to provide this privacy, but this privacy is reserved for the ‘native’ cryptocurrency of the blockchain in question. This transaction privacy is not accessible for digital assets built on top of blockchain protocols. For example, I can’t code up a corporate bond smart contract on Ethereum, where ownership notionals are private.Well, until now, that is.

Maker on Twitter

Whoa. https://t.co/PY4IK0CiaY

{{blog_divider}}

Show and tell: the peculiar case of confidential DAI

Here, take a look at this:

{
   "gamma": "0x20a92d2a4f0dd850314a745719dde20934db69cc8e9b5b84b5819e062d66bb7500",
   "sigma": "0x17d62693c0c9a356e2fd6b0ce877b78c6a1f8a7f195e9db4c0b68e0693d73b3600"
}

This curious jumble of characters is a form of DAI, the dollar-pegged stablecoin created by MakerDAO. But it looks a little odd, doesn’t it? This would normally just be an ethereum address, and a number representing how much DAI that ethereum address has. But this isn’t normal DAI.

You see, when I sent this transaction, my ethereum address (zac.creditmint.eth) became the owner of this DAI, but here’s the thing: nobody can figure out how much DAI I have. Unlike almost every other DAI holder in the world, my DAI balance is encrypted and represented in the form of zero-knowledge AZTEC notes. I can spend this DAI at will by sending some to a different address, but when I do nobody will be able to figure out how much of it I’m sending. For example, I sent a colleague some of my DAI in this transaction and good luck figuring out how much they have.

This is all quite new, and I’m so very excited to be showing this to you and the wider Ethereum community. We’ve been developing this for almost a year now, but we’ve held off on making any formal announcements because I wanted to show you that specific, peculiar, jumble of hexademical characters.

Because this isn’t some imagined technology that will one-day be implemented.

It doesn’t require modifications to the Ethereum protocol.

It is a working demonstration that is live on the Ethereum main-net today, and that AZTEC zero-knowledge note is a real note that encrypts real DAI.

{{blog_divider}}

A breakdown of AZTEC confidential transactions

There are really two questions here: what is the AZTEC protocol and how does it work? I can only answer how by getting into the guts of elliptic curve cryptography, which is a topic for another blog article (you can read a formal description in our paper. For a lightning summary of how this thing works: it’s not a ZK-SNARK, it’s an algebraic zero-knowledge proof that utilizes Boneh-Boyen signatures to create a commitment scheme with a highly efficient range proof embedded into each commitment.

Right, well that’s cleared everything up then. So I’m going to focus on answering what the AZTEC protocol is. What is it doing when transactions are sent to it? To start with, we need to describe what we mean by ‘confidential transaction’.

A confidential transaction is a transfer of value between two or more entities, where the values being transferred are not visible to observers.

Confidential transactions have come in several forms, from ring signatures to ZK-SNARK circuits. Similar to ZCash, the AZTEC protocol uses the concept of encrypted ‘notes’ and join-split transactions.

{{blog_divider}}

Encrypted Digital Assets and the AZTEC note

The AZTEC protocol does not represent ‘value’ like a traditional balance, which maps owners to how much they own. Instead, value is represented by notes. A note contains the following public information:

  • An AZTEC commitment: an encrypted representation of how much ‘value’ the note holds
  • An Ethereum address of the note’s owner

A note has the following private information

  • The value of the note
  • The note’s viewing key. Knowledge of the viewing key enables a person to decrypt the note (but not spend it)

One owner can have multiple notes. A digital asset that conforms to the AZTEC protocol will contain a note registry, which allows a smart contract to recover the public information of every unspent note that currently exists.

{{blog_divider}}

How can AZTEC notes be spent?

An AZTEC note owner can ‘spend’ their notes in a join-split style confidential transaction. In this transaction, the note owner will destroy some unspent AZTEC notes they own. In their place, they will create a set of new notes. The sum of the values of the new notes must be equal to the sum of the values of the old notes, plus a public commitment (I’ll get to that in a bit, but for now let’s assume this is worth 0).

So imagine Alice has two AZTEC notes worth 100 tokens combined. If she wants to send Bob 20 tokens, Alice would create one or more notes owned by Bob, whose values sum to 20. She would then create one or more notes owned by her, the sum of which is 80 tokens.

She would then create an AZTEC zero-knowledge proof that proves this relationship in zero-knowledge (i.e. Alice does not reveal to anybody how much the notes are actually worth, just that the balancing relationship holds). The AZTEC token smart contract will then validate this zero-knowledge proof, destroy Alice’s input notes and then create the output notes in its note registry.

When Alice is creating Bob’s notes, she constructs note viewing keys that Bob will be able to identify, via a non-interactive secret-sharing protocol. Bob is dependent on Alice to act ‘trustfully’ in this regard and not provide viewing keys that can be decoded by observers. This is already implicitly required — after all Alice could broadcast to the world how much she is sending Bob if she did not want the transaction to be confidential.

{{blog_divider}}

How is note ‘ownership’ defined?

Every confidential transaction also requires digital signatures — a signature is required for every input note, signed by the input note’s owner. The message of the signature is a hash of the zero-knowledge proof. This provides an implicit acceptance that the note owners are satisfied with the outcome of the confidential transaction, and want the transaction to be processed.

{{blog_divider}}

How do we get value into AZTEC note form?

Confidentially transfering value is nice, but without a way of getting ‘value’ (let’s call this v) into the AZTEC cryptosystem it all seems a bit academic. This is done via that ‘public commitment’ in a confidential transaction. Assume that the AZTEC token is linked to a public ERC-20 token. If the AZTEC zero-knowledge proof requires a public commitment value v != 0 in order for the balancing equation to be correct, this means one of two things:

1. If v is negative, the output notes are worth -v more than the input notes

2. If v is positive, the input notes are worth v more than the output notes

If Alice issues a confidential transaction where v is negative, the AZTEC token smart contract will transfer -v public ERC-20 tokens from Alice to its own contract address. Effectively, the AZTEC token smart contract acts as a custodian of the ERC-20 tokens while they are in confidential note form. Naturally, if this token transfer is rejected (e.g. Alice doesn’t have enough tokens) then the transaction will be aborted.

If Alice issues a confidential transaction where v is positive, this represents a conversion from AZTEC notes into public ERC-20 tokens. The AZTEC token smart contract will transfer Alice v public ERC-20 tokens.

There’s one small caveat — the amount of tokens being transferred is actually v multiplied by a scaling factor. This is because the range of integers an AZTEC note supports is smaller than that of an ERC-20 token. Our proof of concept deployment to main-net supports numbers from 0 to about 1 million and our full implementation of the AZTEC protocol will support approximately 32-bit integers (more on that in a bit). ERC-20 token balances, on the other hand, are represented by 256-bit integers.

The scaling factor picked depends on the ERC-20 token being linked to. For our proof of concept confidential DAI deployment, an AZTEC note with value 1 is equal to 0.1 DAI.

{{blog_divider}}

What is the cost of all of this?

The AZTEC protocol uses a bespoke commitment scheme that enables highly efficient range proofs. As a result, the amount of computation required by the verification smart contract is much smaller than one might expect. The overwhelming contributor to a confidential transaction’s gas costs is the elliptic curve arithmetic required to validate the AZTEC zero knowledge proof. It costs 3i + 4j elliptic curve scalar multiplications to validate a proof, where i is the number of input notes and j is the number of output notes. Each confidentialTransfer transaction also requires a single elliptic curve bilinear pariing comparison to verify.

The reason I’m using such odd wording is because the gas costs of these arithmetic operations is likely to go down in the future due to protocol upgrades implemented by geth and parity (EIP-1108). It currently costs about 900,000 gas to issue a confidential transaction that contains 4 notes (this is the total gas cost, not just the cost of validating the cryptogrpahy of a transaction). If/when EIP-1108 goes live, the gas costs will fall to about 200,000–300,000.

{{blog_divider}}

What information can be gleaned from confidential transactions?

The AZTEC protocol has been something of a obsession of mine for the past 11 months and I wouldn’t be comfortable releasing this out into the wild without giving a full account of the protocol’s strengths and limitations, I believe that being up-front about this is important.

With that out of the way, any protocol that converts something public into something private will reveal information at the entry and exit points of the cryptosystem.

If you’re adding tokens into note form, an observer will know that the value of the output notes is at least the amount you’ve converted.

Similarly, after redeeming v tokens, an observer will know that the remaining AZTEC notes are worth v less than the input notes.

These problems can be ameliorated by combining public conversions with additional AZTEC notes. For example, imagine Bob has a note worth 100 tokens that he wants to convert into public token form. Instead of just issuing a conversion, Bob should add additional input notes into his transaction and also generate some output notes, even if the extra input and output notes are worth 0. This will prevent an observer from figuring out how much of Bob’s confidential holdings he has converted, even if he has converted all of it and is left with a pile of notes worth nothing.

AZTEC notes have ‘owners’ defined by Ethereum addresses. On the surface, note ownership is not anonymous (e.g. people can see my ethereum address has a zero-knowledge DAI note); the AZTEC protocol includes a Monero-style stealth-address protocol to derive Ethereum addresses that are single-use and cannot be linked to any other Ethereum address (e.g. if you have an AZTEC wallet, I can ‘send’ a note to an Ethereum address you control, but nobody but you and me will know this is the case). The protocol supports both stealth addresses (which require a specific wallet to work; you need two public/private key pairs so a regular Ethereum account won’t work) and regular Ethereum addresses (which are not anonymous — if you own a note everybody will be able to see that).

The more users of a dual public/confidential asset, the greater the privacy provided. For example, when testing our main-net deployment, I converted 50 DAI into AZTEC notes and sent a bunch to my colleagues. Obviously, the sum of all the notes is 50 DAI so a single note can’t encrypt very much. Now imagine that somebody else created 1000 DAI worth of confidential notes, and we split and merged a few of our notes — it would be impossible to identify how much DAI any of these notes had, other than they would have 1050 DAI as a maximum.

To reduce this to extremes — if I converted 10 DAI into a single AZTEC note, this gives no privacy at all. The ability to create notes worth zero is important to maximize privacy — if you were going to convert 10 DAI and wanted a single note for ease-of-use, you should also create a few notes worth 0 DAI to mask how much each note is worth.

Naturally, a ‘lazy’ use of the protocol will leak information. For example, imagine you converted 10 DAI into 5 notes, where 4 were worth 0 DAI. If you then forgot about these notes and never used them in future transactions, it would be fairly obvious to observers that the un-used notes were worth nothing. Always issuing zero-value notes in join-split transactions, and using them in future join-split transactions minimizes the amount of information available to external observers.

{{blog_divider}}

The AZTEC protocol’s trusted setup

The reason the AZTEC protocol is highly efficient is that we combine Boneh-Boyen signature and Pedersen-style commitments into a single commitment scheme with a highly efficient range proof embedded into the commitment. This comes at the cost of requiring a database of elliptic curve points to be generated before the AZTEC protocol can be used. This database is required to construct proofs, but is not needed to verify them.

A bit like ZCash, this trusted setup generates a ‘toxic waste’ private key and if knowledge of that private key is leaked, it can be used to effectively double-spend, and the protocol becomes unusable.

So how do we deal with this? Well, for one we don’t just expect you to trust us. We have developed a scalable multiparty computation protocol that enables anybody to engage in the trusted setup process. If you participate, you generate a piece of ‘toxic waste’ that, naturally, should be destroyed. The trusted setup private key, the thing that must be destroyed at all costs, can only be recovered by piecing together every participant’s toxic waste. So if a single person acts honestly the scheme is completely secure and can only be ‘cracked’ by solving one of the discrete logarithm-based problems (of which the entireity of elliptic curve cryptography rests; if somebody cracks the discrete log problem we’ve all got bigger problems on our hands than the security of the AZTEC protocol!).

We will be announcing the formal description of our trusted setup process in the coming months and will begin to collect participants. It is similar to ZCash’s ‘powers of tau’ ceremony, albeit for a very different end as the AZTEC protocol is not a ZK-SNARK. We want the trusted setup protocol to be simple to take part in and we want to engage the wider Ethereum community in this process, to create a trusted setup database that has the trust and confidence of the community.

Our deployed proof-of-concept smart contracts use a trusted setup that was generated internally, as implementing our multiparty computation trusted setup is going to take several months. Until we have completed this phase the AZTEC protocol is very much use-at-your-own-risk. Whilst I naturally destroyed the toxic waste, there is no way to prove that I did.

One final point (zing…). The size of the trusted setup database grows linearly with the size of the protocol’s range proof. Our proof-of-concept database supports integers between 0 and 1,048,575 because I wanted a database small enough to fit inside a github repo without being a pain to download. Our full implementation will support a much larger range of integers.

{{blog_divider}}

Why is the AZTEC protocol important?

Well of course I’m going to say this is important, I’m the most biased person you could ask on this topic! But here’s why I think this is a real game changer: The AZTEC protocol enables the creation of generic confidential digital assets. We picked DAI to start with but with the press of a button the AZTEC protocol can be applied to any ERC-20 token. It also enables the construction of purely confidential assets that don’t have any kind of ERC-20 token equivalent. No extra cryptographic circuits required, no additional trusted setup processes needed. For the first time ever, it’s possible to create confidential digital assets on Ethereum, obtaining the immutability and decentralization benefits of public blockchains without sacrificing privacy.

AZTEC zero-knowledge proofs are also very efficient to construct, and are well within the capabilities of hardware wallets. This opens up the exciting possibility of issuing confidential transactions directly from hardware wallets and never exposing sensitive private keys.

{{blog_divider}}

What is in the AZTEC protocol’s future?

Of immediate relevance is releasing our AZTEC proof construction API, to accompany our smart contract verifiers and technical paper. We also have several extensions to the AZTEC protocol in the works, and will be releasing our full vision of the AZTEC protocol over the first half of 2019. This includes several important milestones:

1. A confidential decentralized exchange, where people can trade different AZTEC assets in complete confidentiality — neither the quantities or prices of orders can be gleaned from processed orders. The decentralized exchange uses the relayer pattern to acheive this, as well as a bespoke AZTEC DeX zero-knowledge proof (three actually, I’ll be talking about this in depth once our DeX paper is finalized).

2. Confidential weighted voting. Governance mechanics that respect the privacy of a user’s vote are essential a large range of financial applications and the AZTEC protocol’s efficient range proofs make this achievable.

3. Anonymous identity sharing schemes. Being able to prove that you’re part of a group, without revealing who in the group you are is an essential component for many compliance and KYC processes and our AZTEC token standard will support this kind of identity system.

Combined together, this will give builders the tools needed to create the next wave of decentralized financial services; digital assets with implicit privacy and confidential governance mechanics built in from the ground up.

We’re going to be open-sourcing our technology to fully realize this vision — if you want to create private assets on Ethereum, AZTEC will provide the smart contracts, resources and tooling to make it a simple experience.

If you’re interested in building with the AZTEC protocol, drop us a line at hello@aztecprotocol.com. And if you’re a talented developer that wants to work with us on to build the future of decentralized finance, reach out to us because we’re also hiring :).

Cheers,

Zac.

Read more
Aztec Network
Aztec Network
7 Aug
xx min read

Alpha V5 Proving System Vulnerability

Status

Core contributors identified a critical vulnerability affecting the V5 Alpha proving system on 27 July 2026 through internal AI-assisted auditing.

V5 remains Alpha software. Critical findings can arise during this phase, and the audit process exists to identify them before broader deployment. This finding places V5 funds, applications, and contract state at risk.

Treat funds and applications on V5 as exposed to a protocol-level failure until contributors complete incident response work and operators carry out the required network actions.

What we are disclosing

An attacker may be able to exploit a flaw in the current V5 proving system by constructing a proof that passes verification for a transaction the network should reject. If accepted, that transaction could produce a state transition outside the rules V5 intends to enforce.

Contributors cannot determine whether anyone exploited the flaw before this finding. The affected system lacks the information needed to distinguish ordinary accepted transactions from transactions accepted through the flawed proving path. Historical chain activity cannot establish whether exploitation occurred or quantify its impact.

Application safeguards

We expect application teams to prepare safeguards in the coming weeks.

Those safeguards may include changes to application controls, deployment procedures, user flows, and migration plans. We expect each team to assess its contracts and determine which protections fit its architecture and users.

We expect teams planning a V5 deployment to pause that work until contributors publish further guidance. We expect teams with live contracts to review their ability to limit user exposure, isolate affected functionality, and move users to fresh deployments if needed.

We expect applications that maintain administrative or emergency controls to assess whether those controls can reduce user risk during the incident timeframe.

Next steps

Core contributors are working with operators, application teams, and bridge operators as applications add security guards around affected flows.

The findings from this incident will inform the V6 release, including circuit updates that prevent the network from accepting proofs tied to an affected proving system.

V5 launched as Alpha software, with V6 planned for later in 2026. Contributors will publish a security roadmap covering the remaining work and release path.

Known vulnerability status

Reviewers have not identified other high-severity or critical V5 Alpha vulnerabilities at this time.

Internal and external human audits have completed, and contributors continue AI-assisted auditing. Alpha is the period for identifying faults before production deployment.

Community
Community
4 Aug
xx min read

Dark Forest Aztec Game Goes Live

Dark Forest is a real-time strategy game played across a procedurally generated universe where most of the map is hidden. You cannot see rival players, their planets, or their fleets. You only know what you have explored. Everyone shares one universe, and nobody has the full picture.

In most onchain games, every position and every move is public, because the chain is public. Dark Forest used zero-knowledge proofs to break that assumption: players prove their moves are valid without revealing where those moves came from. The result is a game of hidden information running on a public network.

Dark Forest Aztec ports the original Dark Forest 0.6 to Aztec. It keeps the gameplay from the original and rebuilds the privacy layer on Aztec's programmable privacy.

A note before diving in: this is early, experimental software on Aztec Alpha V5. Treat it as an alpha and play accordingly.

The universe you cannot see

You start on a single home planet with almost the entire map dark. To find anything you mine the universe, running a client that explores coordinates and reveals what sits there: unclaimed planets, resources, and eventually the edges of other players' territory.

You are never handed a view of the board. You earn it one region at a time, and everyone else works under the same fog.

What is hidden on Aztec

Your home coordinates and your fleet movements are private state, expressed as first-class private notes on Aztec. Your location and where you send energy stay hidden, enforced in the contracts by zero-knowledge cryptography.

What sits onchain is a set of cryptographic commitments. Instead of storing every planet's full details in the open, the contracts store Poseidon2 hashes of entity state. When you make a move, your client supplies the full state, the contract checks it against the stored hash, applies the change under zero-knowledge constraints, and writes a new hash back. Full game state lives offchain and gets rebuilt from public logs by an indexer, which is what renders your map without exposing every player's position.

So you can prove you made a legal move from a planet you own without revealing where that planet is. Aztec applies the same principle to private payments and private contracts.

How you play

Four actions carry the game.

Explore. Your explorer sits in the bottom left. Set it running and it uncovers the map around you, surfacing planets, resources, and other players.

Send energy. Most planets produce energy. Click and drag from a planet you own toward a target to capture or weaken it.

Route silver. Asteroid fields produce silver. Move it to your planets and spend it on upgrades, or send it to a Spacetime Rip to convert it into score.

Hunt artifacts. Some planets hold artifacts. Your Gear ship discovers them. Once harvested, you deposit them on planets to boost stats.

Four stats drive most decisions.

Energy is the core resource. Planets generate it over time up to a capacity, and you spend it on everything: claiming planets, reinforcing your own, attacking rivals. Two details matter. Moves are taxed, so a flat percentage of a planet's total capacity burns every time you send energy, which discourages small frequent moves. And energy decays over distance, so send it too far and almost nothing arrives. A common rule of thumb is to let a planet fill to about 75%, then send it down to about 25%.

Defense reduces the damage incoming energy does when it lands. Higher-level planets often have lower defense, but they hold much more energy, so they still take more to capture. Defense matters most on front lines.

Range sets how far a planet can send energy. It governs how fast you expand and how efficiently you move energy inside your own empire, since shorter relative distances mean less decay. Good range also lets you strike deep into an opponent's territory.

Speed sets how quickly a move arrives. Usually secondary, though a fast strike can land before a rival reacts, and some playstyles reward capturing many nearby planets quickly.

Planets can also be upgraded with silver and enhanced with artifacts. Space types carry different multipliers, from mild Nebula to punishing Dead Space, so where a planet sits changes how it plays.

How scoring works

There is a scoreboard, and territory alone does not win it. This round scores two activities: discovering artifacts with your Gear ship, and withdrawing silver through Spacetime Rips.

Point values from the in-game help page:

  • Each unit of silver withdrawn: 1
  • Common artifact: 2,000
  • Rare: 10,000
  • Epic: 200,000
  • Legendary: 3,000,000
  • Mythic: 20,000,000

Silver accrues one point at a time. A single Mythic artifact is worth twenty million of them, so artifact hunting decides rounds and silver withdrawal sets your floor.

Silver has two competing uses. Spend it on upgrades and your planets get stronger, extending range and hardening defense. Withdraw it through a Spacetime Rip and it becomes scored points, but it is gone. Every unit is a choice between building the empire and banking points.

Upgrades tend to win early, since a stronger empire reaches more asteroid fields and finds more artifacts. Late in a round that calculation flips, because a planet you never use is worth less than points already scored.

Artifacts do both jobs at once. They score on discovery, and once deposited they boost a planet's stats, which makes the next expedition easier.

Why you explore

Nothing happens until you find something to act on. Your explorer turns dark space into planets you can capture, asteroid fields you can mine, and artifact-bearing planets you can raid. Sitting still means no new energy, no silver, no score.

Exploring also buys information. The map you have uncovered is an advantage nobody else holds. Knowing where high-level planets sit, which asteroid fields are unclaimed, and where space types shift lets you plan further ahead than someone still working through their starting region.

You find other players as a byproduct. There is no player list. You explore outward until your revealed region touches territory someone already owns: a planet in another player's colors, sitting where you were about to expand. Their home coordinates stay private, so you learn something narrow. Someone is here, roughly this direction, holding this much. You infer the rest, and you have no way of knowing whether they found you first.

What happens when you run into someone

You have three broad options.

Stay quiet and keep growing. Nothing forces you to engage. Keep exploring elsewhere, keep routing silver, keep upgrading. Your positions stay private, so silence costs you only time, which is what you want if they are stronger. The risk is that they are doing the same thing faster.

Fortify the border. If the contact sits somewhere you cannot lose, spend energy hardening the planets facing them. Defense is worth most where an attack will actually land. This keeps the option to fight without committing to one.

Attack. Send enough energy to overwhelm the target's defense and the planet becomes yours, along with its production and its position as a staging post. Higher-level planets are the prize and take proportionally more to crack.

Attacking costs more than energy. A move that lands tells your rival where you strike from, and that you are close enough to be worth answering. Retaliation can then come from directions you have not explored, launched from planets you cannot see.

Multiplayer in practice

Everyone plays one shared universe in real time. No turns, no lobbies. Energy regenerates whether you are watching or not, moves stay in flight while you sleep, and rivals expand while you are away from the screen.

Most strategy games let you watch a threat approach. Here you tend to see the consequences: a planet you owned this morning in someone else's colors, an incoming move you notice once it is already close.

That produces a particular kind of paranoia. You are trying to find everyone else while avoiding being found, and every expansion is a strategic bet that the space ahead is empty.

Information becomes tradeable, because it is scarce. Players compare notes, warn each other about aggressive neighbors, and agree who expands where, then break those agreements when the scoreboard makes it worth breaking.

Why it matters beyond the game

A fully onchain game where players cannot see each other's positions is hard to build, and building it well says something about the platform underneath.

Hidden state, private notes, and client-side proving are the same building blocks behind private applications across Aztec. Dark Forest is a way to watch them work.

Getting started

Dark Forest Aztec is playable now as an alpha. Expect a learning curve; the original was famous for it. DFArchon maintains onboarding material and a community for new players. Round One is live. The universe is dark, and everyone else is out there somewhere. Go find them, quietly.

Play Now

Follow the Builders

DFArchon on X

Source and docs

Aztec Network
Aztec Network
22 Jul
xx min read

How Gas Works on Aztec

Gas on Aztec

Gas on Aztec is known as Fee Juice and is used to pay for transaction costs. This is the same as $ETH on Ethereum. Some apps will handle transaction costs for you under the hood, but if you are using a browser extension wallet, you will not be able to send transactions without it. Fee Juice can be obtained by bridging the $AZTEC token on Ethereum to the Aztec Network L2. This means that under the hood, all activity that happens on Aztec is underpinned by the $AZTEC token bridged into the network. Some bridges like Shield (by human.tech) handle this for you, allowing you to allocate a portion of your bridged transaction to convert into Fee Juice and land in your wallet automatically.

Public vs Private Assets

Assets and transactions on the Aztec Network can be either public or private. If you bridge publicly, your tokens will arrive as public, traceable tokens visible to all. Privately bridging, on the other hand, will give you private assets that are visible only to you. These assets can then be sent privately to another user or wallet without ever revealing who you are, what tokens were sent, how many, or who the recipient is.

Public vs Private Gas

Like tokens on the Aztec Network, Fee Juice (gas) can also be public or private. The reason for this is that even if what you are sending is private, the gas you spend to execute that transaction could still be visible if you are using public Fee Juice, potentially revealing transaction patterns and activity. Private Fee Juice keeps your entire transaction footprint hidden. When you send a private transaction, you can use private Fee Juice, and when you send a public transaction, you can use public Fee Juice, which means your transaction costs are always aligned with the type of transaction you're making.

Fee Juice in Apps

Aztec has native fee abstraction, which means apps could let you pay for transactions in any token you want, or cover your fees entirely. Apps like Nyx may choose to cover part or all of a user's transaction costs, or allow you to pay in tokens that are convenient for you. This means you will most likely never see Fee Juice in an app; instead, you'll pay in whatever makes sense for what you're doing, on your terms. Similarly, you might never even see an Aztec wallet at all, because the app itself becomes your interface that you connect to using your MetaMask wallet.

Fee Juice in Browser Wallets

If you're using a browser extension like Azguard, you'll manage Fee Juice directly in your wallet alongside your private and public balances, converting between tokens as needed to cover transaction costs.

When you bridge tokens in, you'll need enough Fee Juice to cover the cost of your first transaction, then you'll need to monitor how much Fee Juice you have available to make transactions. Browser wallets will allow you to send either publicly or privately to other users and will default to using either public or private Fee Juice depending on the type of transaction. Both private Fee Juice and public Fee Juice will appear by default in your token list.

Wrapping up

How you handle Fee Juice depends on where you're transacting: apps can abstract it away entirely and let you pay in any token, while a browser wallet like Azguard puts it in your hands to manage across public and private balances. Match your gas to your transaction, keep private activity private down to the fee, and you move on your terms.

Aztec Network
Aztec Network
21 Jul
xx min read

Introducing Alpha V5

The Aztec Network today activated Alpha V5, a major protocol upgrade passed by token-holder governance and executed onchain. Alpha V5 reduces private-transaction proving times by more than 2x compared to the previous version, lowers the cost of a fully private transaction by roughly 50%, resolves the critical issues found in V4, and sees the first wave of apps go live. Users can now send private transactions and earn yield on Aave simply by connecting their Ethereum wallets on Nyx, bridge from Ethereum to Aztec using Shield or TRAIN, privately collect NFTs on RavenHouse, or play Dark Forest Aztec, a hidden-information strategy game in a universe that lives entirely onchain. 

"Alpha V5 continues Aztec's work at the frontier of client-side proving, with cryptographic breakthroughs that cut proving times by more than half this release," said Zac Williamson, Co-founder, Aztec Foundation. "We believe Aztec is now the fastest system in the world for proving a fully private transaction entirely on a user's own device, and every release moves the industry closer to private transactions at public transaction speeds."

As the only decentralized L2, Aztec is the credibly neutral privacy layer for Ethereum. Aztec allows anyone to write smart contracts that include both private and public aspects – every private transaction is proven on the user's own device, so no operator, sequencer, or intermediary can see the data. The Alpha V5 proving improvements come from cryptographic advances that make this client-side proving faster than any prior release. The network remains in alpha, but with V5 it is ready for teams to begin building and deploying applications.

Performance - 2.5 second fully private transactions 

Making private transactions practical comes down to how quickly a proof can be generated on a user's own device, without offloading that work to a server that would learn what the user is doing. On Alpha V5, proving a private token transfer natively now takes approximately 2.5 seconds on a consumer laptop, down from 5.2 seconds on V4, and about 6.8 seconds in a browser, down from 12.5 seconds. Across every measured transaction flow, client-side proving times improved by approximately 2x compared with V4.

Bench machine: an M2 MacBook (12 cores, throttled to 8). "Native" runs Aztec's C++ proving binary; "WASM" runs the same prover in a browser engine (Node on V8).

Alpha V5 lowers ECDSA signature-verification cost by approximately 2x, speeds up Poseidon2 hashing by approximately 3x, and reduces the protocol circuit gate count by approximately 50% (gate count is the number of individual operations a proving circuit must perform, and it is the main driver of how long a proof takes to generate). Each of these lowers the amount of work a device performs to prove a transaction, and the reduction in gate count in particular compounds across every proof the network generates.

Apps - send, receive, and earn privately on Ethereum

Alpha V5 launches the first wave of apps on a network where privacy is built into the protocol rather than managed by an operator. On other networks that claim privacy, transactions still pass through an operator or node that reads them in plaintext, or depend on a viewing key that a third party holds, so users rely on someone else to protect their data and to decide when it gets disclosed. On Aztec, every private transaction is proven on the user's own device, so the app, the sequencer, and any operator never need to see the underlying data. Nyx is one of these apps, allowing users to privately send transactions and privately earn yield on Aave. 

"On Ethereum, everything you do is public. That's why we built Nyx: a private account governed by your Ethereum wallet", said Nikhil, Co-founder of Nyx. "Now you can send, receive and earn in private. Nyx was the first app live on the Aztec Alpha, and we're excited to expand participation to more users with the added stability of Alpha V5."

Other apps on Alpha V5 include Azguard and Nethermind (wallets), Shield, TRAIN, and RavenHouse (bridges), and the Aztecscan block explorers. Also launching is Dark Forest Aztec, a game where users explore a universe, control planets, manage planetary energy, expand territory, and launch attacks through strategic play with private state and hidden actions.

Dark Forest Aztec private universe-building gameplay

Lower costs, higher security 

Transaction fees on Aztec come from two main sources: the cost of proving a transaction and the cost of verifying the rollup proof on Ethereum. Alpha V5 reduces both. It lowers the network's proving-cost parameter by 50%, and it reduces the L1 gas required to verify a rollup proof by approximately 40%. Because rollup proofs are verified on Ethereum and that cost is shared across all transactions in a batch, the L1 reduction lowers fees for every user, while the lower proving-cost parameter reduces the per-transaction proving fee directly. Together, these bring the average cost of a fully private token transfer to under a $0.05 transaction cost.

Alpha V5 also hardens the network on several fronts. It resolves critical vulnerabilities found in Alpha V4 along with additional bugs discovered since launch. Aztec's bug bounty program on Cantina also drew more than 234 security researchers to participate. The network remains in alpha, and further bugs may surface as usage grows, but each release has closed the issues found in the last and strengthened the protocol against new ones. With the critical V4 issues resolved and these safeguards in place, Alpha V5 is stable enough for teams to begin building and deploying applications.

Availability

Alpha V5 is live now, view the Alpha V5 landing page for a full list of features, performance updates, and live apps to explore. 

About Aztec

Aztec is the only decentralized, privacy-first Layer 2 on Ethereum. Developers write private and public logic in the same smart contract, and private functions are executed and proven on the user's own device, so no operator sees the underlying data. The protocol is upgraded through onchain governance, and the network settles to Ethereum. For more information, visit aztec.network.