A question has been troubling Web3 all along: can't user privacy and regulatory requirements really coexist?

Actually, not necessarily. Recently, I came across a project whose core idea is to break this binary dilemma—privacy and regulation can run in parallel.

How is this achieved? Users have the choice to decide whether their transactions are public or private. Once privacy mode is enabled, the project's Hedger engine employs two advanced technologies: zero-knowledge proofs and homomorphic encryption. It sounds complex, but the actual effect is straightforward: transaction amounts and account balances are fully encrypted, third parties cannot see them, yet the network verification mechanism remains effective—legitimacy of transactions and accuracy of amounts are verified as usual, with no data leakage risk and no possibility of rules being bypassed.

This solution is implemented on DuskEVM, representing an interesting exploration in the privacy track. It can protect user privacy without sacrificing system transparency and verifiability.