Announcing COTI’s Upcoming ETH L2 Developer Network and Key Target Use Cases For its Growth Fund
COTI Foundation is proud to announce the key use cases it will target using its development fund, currently valued at almost $100 million, to be allocated in COTI tokens.
Blockchain networks have created an entire industry of revolutionary experiences. Borderless finance, democratized leadership, trustless interaction, and automated contract management are just a handful of massive opportunities that would be impossible without Web3. But as world-changing as it is, Web3 has always been limited by a stark lack of privacy. Full transparency is refreshing for democratizing an organization, but it cripples the practicality of many other use cases.
COTI V2, powered by Garbled Circuits, introduces a 1000 times faster and 250 times lighter privacy solution that can be operated on any device, providing a seamless and better user experience than current solutions. Additionally, Garbled Circuits can handle transactions between multiple parties, unlike limited ZK-based solutions. The ability to keep data secure while using it for verification and computation — especially at this scalability — creates new use cases for not only Web3 applications, but Web2 industries as well.
The COTI Foundation will bolster the growth of the COTI ecosystem using its substantial development fund. The first step will start with the upcoming Developer Network (Devnet) to be launched in early Q2, this year. The launch of the COTI V2 Devnet along with the upcoming grant program will allow developers to experiment and build with the technology and be rewarded for their contribution. Utilizing the familiar smart contract language, Solidity, developers can bring privacy to existing applications, or innovate by creating brand-new use cases for the ecosystem.
The following use case areas show what, we believe, are the most critical areas where COTI V2 can revolutionize the market. Over time, there will undoubtedly be more areas and innovative ideas that the community will bring forward. Development teams can submit proposals of their ideas, and the most promising and innovative projects will earn grants to accelerate their successful implementation.
Confidential DeFi
DeFi has transformed how the industry views finance and its possible uses. However, the on-chain transparency has also created an uncomfortable compromise of privacy eliminating institutions from using Defi for regulatory reasons. Novel DeFi primitives such as private AMMs, dark pools, under-collateralized lending, blind auctions, and Hybrid DEXs all rely on the ability to shield the privacy of users as well as the content of transactions. Without this privacy, DeFi’s innovation capability plateaus.
COTI V2 will bring confidential transactions that allow decentralized apps to offer new products and services, but also greatly increase both the privacy and security of services they currently offer (all while still being able to maintain regulatory requirements).
The other critical DeFI improvement is COTI V2’s ability to finally solve one of the longest-running “exploits” in Ethereum DeFi: Losses from MEV. With encrypted DeFi transactions, MEV bots and frontrunners do not have the information needed to frontrun transactions and profit at others’ expense.
With the upcoming COTI V2 Devnet, developers will have the opportunity to take their existing dApps and easily create robust overhauls using the COTI V2 data security, or develop new DeFi-driven dApps that simply weren’t possible before now.
Confidential Transactions for Payments, Stablecoins and RWA
Traditional finance systems offer distinct levels of confidentiality to users, fostering trust and encouraging participation. In everyday banking, for example, the confidentiality of transactions is paramount. For Web3 to achieve mainstream adoption, it must follow. COTI V2 addresses this challenge by providing secure confidentiality and ensuring adherence to regulatory standards for assets, including stablecoins and real-world assets. COTI V2 enables confidential payments by maintaining the transparency of fund flow while encrypting transaction details such as the amount of funds sent and the type of tokens involved.
Confidential Machine Learning (introducing GCML) and On-Chain Sensitive Data Management
Data management is playing a stronger role in daily life, creating new opportunities for data brokers, and advertising applications, but if the data is not protected it can be at the expense of customers. COTI V2 creates the ability to store data on-chain in an encrypted manner and then allows others to query this data confidentially. This can be valuable for analyzing sensitive information such as medical records without compromising patient confidentiality.
Not only that, with the COTI V2 model, data can be safely shared across sites that today would scrape and sell the data. Large language models (LLMs) like ChatGPT utilize vast amounts of user data to provide more services and knowledge to their customers but may violate both user privacy and company IP. However, with COTI V2 using GCML (Garbled Circuits Machine Learning), these models could do so in a way that doesn’t violate the privacy of those whose data it uses, opening up whole new business models.
Dynamic Decentralized Identification (DID)
COTI V2 allows all identity verification and personal information to be shared, calculated, and stored, but without revealing the actual data to other parties. The user stores their own data, is fully able to comply with KYC requirements, but doesn’t have to give away their information. At the same time, dApps will be able to interact with digital identities and query them on specific insights (e.g. Is the user an EU citizen? Is the user over 18 years old?). All of this happens with no specific, private information being shared between parties. The result is countless applications for both Web2 and Web3 to create trustless environments where parties can interact globally in a fully regulated environment, all without compromising their sensitive information. This will open entire new sub-industries for global services.
On-chain privacy has been one of the few but largest weaknesses of a Web3 mass adoption ecosystem. There are already major privacy issues within Web2 industries, and the problems they create are felt by nearly everyone. COTI V2 with its innovative garbled circuit technology comes at the perfect time for the Web3 industry to not only resolve its data privacy issues, but to create solutions far superior to anything Web2 can provide its users. The business opportunities are ripe for the picking, and developer teams globally are invited to take part in our upcoming COTI V2 Devnet.
Stay COTI!
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