Here are the current problems that Sacred aims to solve through our innovative take on traditional mixers.
Problem #1 - Capital Inefficiency
Although traditional mixers aim to mask a user's transactions and assets, deposits sit idle and miss out on yields. Current privacy solutions require the user to keep their funds in money mixer pools for as long as possible (the longer their asset stays in the mixer, the more private their assets will be).
Sacred brings a novel privacy solution that maximizes capital efficiency within a mixer and the need to move assets through traditional mixers continually to maintain privacy. Integrating DeFi with traditional mixers, Sacred provides another layer of privacy through Sacred Boxes. When a user deposits their assets in a Sacred Box, Sacred interacts with a DeFi partner on the user's behalf. Since every transaction a user makes on Sacred goes through a mixer, it further disassociates their depositing and withdrawing addresses, allowing users to maintain their privacy easily.
Sacred does this through a non-custodial mixer which allows a user to earn yield privately by breaking the on-chain link between the depositor's and the withdrawer's addresses utilizing a cryptographic technology called ZK-SNARK (Zero-Knowledge Succinct, Non-Interactive Argument of Knowledge). By leveraging Sacred's mixer, observers cannot collect wallet addresses and watch assets moving on blockchain scanner tools like Etherscan.
Why do we need privacy?
With the advent of web 3.0 and DeFi, finance has become truly open and permissionless. However, with this new financial revolution comes the reality that all transactions are publicly available due to the nature of blockchain technology. With little difficulty, any observer can determine a user's net worth, follow the new investment markets they are tapping into, collect data for advertising, and analyze their behavioural patterns. Unfortunately, being your own bank also presents new risks alongside all the benefits.