Here is a question I have not seen a good answer to anywhere in the RWA space. If the holders are private, how does the issuer pay the coupon?
A bond does not just sit there. Twice a year it pays. Sometimes it gets called early, sometimes terms get amended, sometimes there is a vote. In traditional markets this is routine plumbing. The CSD knows the register at the record date, the payment pushes down the custody chain, everyone gets their share.
Now shield the holdings. The issuer no longer knows who owns what or how much. The plumbing that made coupon payments boring has just been switched off.
There are two shapes an answer can take, and they are not equivalent.
One is that the contract distributes on its own. Payment logic executes over encrypted balances, each holder is credited pro rata, and nobody learns the distribution. This is where homomorphic encryption stops being a buzzword, because you cannot compute a pro rata split over data you are not allowed to read using zero knowledge proofs alone. ZK proves a statement. HE performs arithmetic on ciphertext. Servicing needs the arithmetic.
The other is that holders claim. At the record date the chain commits to a state, and later you prove you held a position at that block without revealing the position. Cleaner cryptographically, but it moves the burden onto the investor and quietly introduces the possibility of unclaimed entitlements sitting there forever.
The first keeps the asset behaving like an instrument. The second makes it behave like an airdrop.
@Dusk_Foundation which model does the stack assume for servicing, and is record date state provable historically or only at the current head? That distinction decides whether a shielded security can pay a dividend at all.
Genuinely curious whether anyone here has seen a tokenised bond actually service a coupon onchain, not in a whitepaper.
@Dusk_Foundation $DUSK #dusk #RWA
A bond does not just sit there. Twice a year it pays. Sometimes it gets called early, sometimes terms get amended, sometimes there is a vote. In traditional markets this is routine plumbing. The CSD knows the register at the record date, the payment pushes down the custody chain, everyone gets their share.
Now shield the holdings. The issuer no longer knows who owns what or how much. The plumbing that made coupon payments boring has just been switched off.
There are two shapes an answer can take, and they are not equivalent.
One is that the contract distributes on its own. Payment logic executes over encrypted balances, each holder is credited pro rata, and nobody learns the distribution. This is where homomorphic encryption stops being a buzzword, because you cannot compute a pro rata split over data you are not allowed to read using zero knowledge proofs alone. ZK proves a statement. HE performs arithmetic on ciphertext. Servicing needs the arithmetic.
The other is that holders claim. At the record date the chain commits to a state, and later you prove you held a position at that block without revealing the position. Cleaner cryptographically, but it moves the burden onto the investor and quietly introduces the possibility of unclaimed entitlements sitting there forever.
The first keeps the asset behaving like an instrument. The second makes it behave like an airdrop.
@Dusk_Foundation which model does the stack assume for servicing, and is record date state provable historically or only at the current head? That distinction decides whether a shielded security can pay a dividend at all.
Genuinely curious whether anyone here has seen a tokenised bond actually service a coupon onchain, not in a whitepaper.
@Dusk_Foundation $DUSK #dusk #RWA