Private DeFi, explained
Zero-knowledge proofs, nullifiers, anonymity sets, linked addresses, THORChain and the other words around private DeFi, each in plain English, with how it shows up in Redacted.
Privacy and cryptography
Address reuse
Address reuse means receiving more than one payment to the same address. Every payment to it is then linked to all the others, and to everyone who sent them.
Anonymity set
An anonymity set is the group of people a given action could have come from. The larger it is, the harder it is to tell who did it.
Chain analysis
Chain analysis traces funds on public blockchains and groups addresses into likely owners, using the public record together with outside data such as exchange records, address labels and leaks.
Commitment
A commitment locks in a piece of data without revealing it. Later it can be opened and anyone can check that it matches, but until then it gives nothing away and cannot be changed.
Front-running
Front-running is trading ahead of an order you can see coming. On public chains, bots and traders watch visible orders and wallets and act first, at the expense of the person whose order they saw.
Linked addresses
Linked addresses are addresses that chain analysis attributes to the same owner, most often because they were spent together in one Bitcoin transaction. Once one of them is tied to a name, all of them are.
Merkle tree
A Merkle tree fingerprints a long list with one short value, the root, so that anyone can prove an item is in the list with a handful of hashes instead of the whole list.
Nullifier
A nullifier is a unique value published when a private note is spent. It lets the chain reject a second spend of the same note without revealing which note was spent.
Self-custody
Self-custody means you hold the keys to your funds yourself, so no company can freeze, lose or move them on your behalf.
Shielded pool
A shielded pool holds funds as private notes inside a smart contract. Deposits and withdrawals are public, but what happens inside is proved with zero-knowledge proofs and does not reveal who owns what.
Stealth address
A stealth address is a one-time address created for a single payment, so payments to the same person cannot be linked on-chain, while the sender only needs the receiver’s public address.
Trusted setup ceremony
A trusted setup ceremony creates the public parameters that some zero-knowledge proof systems need. Each participant adds secret randomness and destroys it, and the result is safe as long as at least one participant was honest.
Viewing key
A viewing key lets someone see the history of a private account without being able to spend from it, for example to show an accountant or an auditor exactly what happened.
Zero-knowledge proof
A zero-knowledge proof lets someone prove that a statement is true without revealing anything else, for example that they own funds and may spend them, without showing which funds or who they are.
zk-SNARK
A zk-SNARK is a zero-knowledge proof that is small, quick to verify and needs only one message from the prover, which is why blockchains can check them inside a smart contract.
Redacted
Emergency exit
The emergency exit opens by itself if no active Redacted node carries an action or sends a heartbeat for 7 days. Anyone can then withdraw from the Reserve, or close positions and move funds out of Spending, by submitting the action from their own wallet.
Node network
Redacted’s node network is a group of independent, bonded operators who carry private actions on-chain and approve every deposit, each choosing what it checks before it approves. No single node can send a deposit back or pause deposits alone.
Note
A note is a sealed entry on-chain that records coins in Redacted’s Reserve and that only your keys can open. From the outside all notes look alike, whoever owns them and whatever they hold.
Ozone
Ozone is the reference screener for THORChain and Rujira, built by Redacted’s core contributors. It answers whether an address is tied to known hacks or sanctions lists, works only from public data and decides nothing itself.
Private Mode
Private Mode is the private side of Redacted. You open it with one wallet signature that creates your private keys in your browser, and after that zero-knowledge proofs authorize every action, so your wallet has nothing more to sign.
Relayer
A relayer submits a transaction to the blockchain on someone else’s behalf and pays its network fee. Privacy tools use relayers so that a private action doesn’t have to come from, or be paid for by, the user’s own wallet.
The Reserve
The Reserve is the shared space where every Redacted user’s deposits live together as sealed notes. From the outside all notes look alike, so an action from the Reserve could have come from anyone who has the same coin in it.
Spending account
A Spending account is your personal private account in Redacted: a smart-contract account with no visible tie to your public wallet, from which you trade, swap, stake, lend and borrow on Rujira.
The wait
With Redacted’s node network, new money waits about two hours before it can be used privately, so a deposit can’t be matched to what you do with it a few minutes later.
THORChain
Native cross-chain swap
A native cross-chain swap trades a coin on one chain for a coin on another, for example Bitcoin for Ether, by moving the real coins between vaults instead of minting wrapped copies on a bridge.
Price oracle
A price oracle brings market prices onto a blockchain so that smart contracts can use them, for example to value collateral and decide when a loan gets liquidated.
RUNE
RUNE is THORChain’s native asset. Node operators bond it to take part in the network, and it sits on one side of every pool of liquidity, so a swap from Bitcoin to Ether runs from BTC to RUNE to ETH in one flow.
Secured assets
Secured assets are native coins deposited into THORChain’s vaults and held one to one on THORChain, such as BTC-BTC for Bitcoin. Apps use them for trading, lending and more, and they can be withdrawn back to their home chain as the real coin.
THORChain
THORChain is a network that swaps native coins across chains, such as Bitcoin for Ether, with no bridges and no wrapped tokens. The coins sit in vaults on their home chains, secured by about 100 independent node operators.
Wrapped token
A wrapped token stands in for a coin from another chain, such as WBTC for Bitcoin on Ethereum. It is worth the real coin only as long as whoever holds the original keeps it safe and honors redemptions.
Rujira
Liquidation
A liquidation sells part of a borrower’s collateral to repay their loan when the collateral is no longer worth enough to cover it safely.
Loan-to-value (LTV)
Loan-to-value compares what you owe with what your collateral is worth. Borrowing $50 against $100 of Bitcoin is an LTV of 50%, and the higher it gets, the closer the loan is to liquidation.
Money market
A money market lets people lend coins to earn interest and lets others borrow them against collateral, with rates that rise as more of a coin is borrowed.
Orderbook
An orderbook lists every open order to buy or sell at a set price. A limit order waits on the book until the market reaches its price, instead of trading at whatever the price is right now.
Recurring order
A recurring order buys or sells in equal parts on a schedule, for example the same amount of Bitcoin every day, instead of all at once. This is also called dollar-cost averaging, or DCA.
Rujira
Rujira is THORChain’s app layer: orderbook trading, swaps, lending, borrowing, staking and more, all with native coins held as THORChain secured assets.
Updated October 7, 2026. The full details live in the documentation.