Ethereum Foundation Launches Privacy Cluster and Kohaku Wallet to Redefine On-Chain Confidentiality

Vitalik Buterin Endorses Full-Stack Privacy Vision as Ethereum Targets End-to-End Protection

TL;DR:

• Ethereum Foundation forms a 47-member Privacy Cluster to embed native privacy into the network’s architecture.
• Kohaku wallet framework introduces modular privacy layers for transfers, DeFi activity, and identity verification.
• Market attention shifts toward privacy narratives, reigniting interest in coins like Monero and Zcash amid changing crypto price index trends.

A coordinated privacy overhaul is underway across Ethereum’s ecosystem, led by a newly launched “Privacy Cluster” of 47 engineers, cryptographers, and researchers under the Ethereum Foundation. The initiative, revealed on October 9, 2025, marks one of the network’s most significant structural pivots since the Merge, uniting fragmented privacy R&D into a cohesive framework focused on private writes, private reads, and private proving. Igor Barinov, founder of Blockscout, has been tapped to lead the group, which is designed to collaborate closely with the Foundation’s Institutional Privacy Task Force and the rebranded Privacy & Scaling Explorations (PSE), now operating as the “Privacy Stewards of Ethereum.”

The new structure lays the groundwork for privacy as a native property rather than a bolted-on layer. The Foundation’s roadmap targets full-stack privacy within the next six to twelve months, spanning protocol design, infrastructure, wallet development, and decentralized applications. Among the earliest milestones are confidential transfers through Layer-2 solutions like PlasmaFold, privacy-preserving DeFi interactions, and zero-knowledge-based identity systems capable of verifying user credentials without exposing personal data. The plan also addresses wallet-level metadata leaks, such as IP traces left by RPC providers and transaction queries that can be tied to specific users—a longstanding issue affecting tools like MetaMask.

Kohaku, a new privacy-focused wallet framework, sits at the center of the Foundation’s plan. Built as a modular SDK and reference wallet inspired by Ambire, Kohaku introduces optional privacy layers that developers can integrate selectively. Features include masked transaction amounts, counterpart anonymity, peer-to-peer broadcasting to avoid centralized RPC nodes, and per-DApp account segmentation to isolate on-chain identities. Its architecture also anticipates future cryptographic threats by experimenting with post-quantum signature schemes such as Falcon and Dilithium. Early builds incorporate support for the Helios light client, enabling local validation without external data exposure, and propose social recovery tools leveraging ZK Email or Anon Aadhaar for privacy-protected identity recovery.

Ethereum co-founder Vitalik Buterin publicly endorsed the initiative, describing “full-stack privacy and security as first-class priorities for Ethereum” in a post on X. He highlighted the Kohaku code and roadmap, emphasizing its integration with Railgun’s zero-knowledge tooling to prevent illicit fund misuse. Buterin noted that funds failing validation “can only return to their original address,” a safeguard against regulatory and reputational risk. His comments reinforced the view that privacy must evolve alongside transparency, balancing user confidentiality with accountability.

Analysts observe that Ethereum’s renewed privacy direction is already influencing market sentiment. The privacy-token sector, including projects like Monero (XMR) and Zcash (ZEC), has rallied 65.3% in the past month amid growing institutional attention to blockchain confidentiality. The shift underscores a broader narrative in the crypto price index landscape, where privacy, once sidelined by scalability debates, is reclaiming strategic relevance. Ethereum’s pivot could eventually impact the broader coin market cap distribution, as privacy technologies re-enter mainstream discourse and become critical differentiators for compliance-ready financial applications.

The Foundation’s emphasis on interoperability, cross-chain communication, and intent-based transaction design signals that privacy will be integrated across the entire stack—from consensus to user experience. Upcoming test deployments are expected to coincide with Devcon in late November, where the first Kohaku SDK demo may be unveiled. Researchers argue the success of this roadmap depends on coordinated adoption across wallets, L2 networks, and decentralized apps, ensuring that private operations remain gas-efficient and user-friendly. As Ethereum positions confidentiality alongside scalability and security, the network is effectively rewriting its social contract: transparency remains a feature, but discretion is becoming a right.

This article has been refined and enhanced by ChatGPT.