Whirlpool Cash: The privacy protocol on the Cross-chain Hub of DotSama

We are introducing our vision for Whirlpool Cash, a Composable Labs incubated protocol. Privacy is a core feature of finance: no one wants others to have unbridled access to their financial information. As such, there is a need for privacy-preserving solutions in the decentralized finance (DeFi) space.

Privacy solutions that currently exist in DeFi, however, reinforce the siloed nature of blockchain ecosystems. The movement towards interoperability within the DeFi space currently means less privacy, not more. When users bridge assets cross-chain or cross-layer, many would assume this obfuscates transactions further. The opposite is currently true, however: the cross-chain, cross-layer movement of assets further reveals them, and interoperability works against privacy today.

The ethos of DeFi is to give individuals sovereignty over their finances and prioritize their financial incentives. Privacy is therefore a necessary component of DeFi’s offering. However, the most widely adopted DeFi privacy solutions today conform to traditional finance (TradFi) standards on yield generation. They do not provide financial incentives to users but instead burden them with transaction fees. As such, privacy becomes a privilege in DeFi and not a feature.

The Whirlpool Cash solution

To solve these issues, Composable built Whirlpool Cash on Picasso — the cross-chain hub.

Whirlpool is a privacy-preserving pallet built on the Picasso parachain. Through integration into the runtime of Picasso, a natively interoperable Layer 1 (L1) that offers a wide range of DeFi primitives for developers to leverage, it is imbued with cross-chain and cross-layer capabilities. Whirlpool Cash can thus use the native interoperability of the Picasso ecosystem to empower anonymity, enable privacy, and become a Hop-like bridge to move assets between chains and layers.

Through interoperability with the privacy-preserving Secret network blockchain on the Cosmos ecosystem, via the Centauri-IBC bridge, Whirlpool enables private bridging, i.e. anonymized end-to-end. In addition, it creates a new financial opportunity for users to generate returns; through the use of a mechanism modelled after new generation DEX AMM limit options trading, Whirlpool generates yields on assets in its anonymizing pools.

As Whirlpool is built as a pallet on Picasso, the cross-chain hub of DotSama, it will be amongst the most prominent and effective privacy-preserving DeFi solutions in the DotSama ecosystem, caters to end-users and developers looking to augment their protocols with privacy capabilities.

Enabling privacy-focussed yield farming

Current tumbling services that provide privacy to users exclude yield earning opportunities. Whirlpool adopts a more efficient approach. Whirlpool cash provides yield earning opportunities with the capital sitting in the tumbler. Through a Hop-like bridge, users can select a source chain and destination chain for their token’s transfer. Then, through a novel distributed system and zero-knowledge proof (zkSnarks), Whirlpool is able to facilitate private cross-chain transfers at the cheapest possible cost. It, therefore, serves as a privacy-preserving routing layer that also enhances yield generation opportunities, as liquidity moves between chains and layers.

To facilitate inter-ecosystem privacy-focused liquidity transfer, Whirlpool doubles as a bridge to facilitate the flow of liquidity between IBC tokens sent from the Cosmos Hub and EVM-enabled chains. Through the use of the Secret Network, an IBC-enabled privacy-preserving blockchain, and the Centauri-IBC substrate bridge, Whirlpool will allow for more comprehensive, anonymous cross-chain transactions.

The Future of anonymity with Whirlpool Cash

Few protocols offer true anonymity, as transactions are public on the blockchain, and can be used to doxx pseudonymous entities. Whirlpool was created to fulfil a major need, by acting as a vital privacy infrastructure that expands beyond support for a single token class. It will instead interoperate between several liquidity-rich ecosystems, EVMs, and L1s and L2s.
As the first privacy-preserving protocol in a budding ecosystem, Whirlpool Cash aligns with Composable’s goals to enhance privacy, enable interoperability, and generate greater yields. In the future, Whirlpool will be able to provide privacy enabled transactions across multiple networks while supporting cross-chain and layer deposits and withdrawals.

About Whirlpool Cash

Whirlpool Cash is a cross-chain privacy-preserving and yield generating protocol built on Picasso, the cross-chain hub of DotSama. Whirlpool facilitates improved security, enhanced privacy, yield generation and augmented interoperability between several liquidity rich chains and layers. Whirlpool Cash is not constrained to a single asset type as others are to ETH and ERC-20 based tokens. Instead, Whirlpool Cash supports all tokens by Picasso network and tokens on other substrate-native chains. Whirlpool doubles as a bridge to facilitate the flow of liquidity between IBC tokens sent from the Cosmos Hub and EVM-enabled chains. Through the use of the Secret Network, an IBC-enabled privacy-preserving blockchain, and the Centauri-IBC substrate bridge, Whirlpool allows for more comprehensive, anonymous cross-chain yield generating transactions.

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