Last night, when Old Zhou had finished his second bottle of beer, he suddenly slammed his cup down. He’d been divorced for three years; then his ex-wife suddenly wanted to audit his accounts, suspecting he’d shifted assets to the children and withheld the funds meant for their tuition. He pounded the table and asked me: “You say every single dollar I have is clean—so how do I prove it’s clean without laying bare all my assets?”
I took this matter seriously and studied it. I read the @Dusk white paper twice. In the list, there are seven organizations, and the data is precise down to the unit digit.
The core contradiction in anti–money laundering due diligence can actually be summed up in one sentence: keep records to prevent leaks of privacy, but if you don’t keep them, you’re noncompliant. Dusk’s approach is pretty smart. It created a Citadel identity layer, combined with ZK selective disclosure—sounds not that complicated, right? It’s like going through security: you only need to prove there’s no knife in your bag; you don’t have to pull out your underwear for everyone to see. The credentials can prove you’re a “qualified investor,” but your passport number doesn’t need to be revealed.
Moonlight keeps the chain transparent, Phoenix handles privacy with UTXOs—audits can verify, and privacy is still preserved. I think this detail is especially well considered: the auditors can see what they’re supposed to see, but not what they shouldn’t.
But beyond the cryptography loop, the other issues are what really wear you down. The credential issuer whitelist currently has only seven organizations; adding one requires community voting. There’s also a revocation mechanism—if a credential becomes invalid, how do you synchronize it immediately? Cross-border regulatory mapping: how do MiFID and the SEC recognize each other? All of that depends on off-chain Oracles feeding the data. Sounds not that complicated, right? But regulatory back-and-forth can strip you down layer by layer.
Technically, the problem is solved for 70%. The remaining 30% is a real legal tug-of-war and regulatory negotiation. Writing the code is fast—but getting regulatory approval is slow. Don’t mistake cryptographic progress for real-world adoption progress.
Old Zhou later didn’t ask about the technical details again. He just said one thing: “I just want certainty—the certainty that proves my innocence.” You see, that’s harder to write than code, isn’t it?
#dusk $DUSK @Dusk
I took this matter seriously and studied it. I read the @Dusk white paper twice. In the list, there are seven organizations, and the data is precise down to the unit digit.
The core contradiction in anti–money laundering due diligence can actually be summed up in one sentence: keep records to prevent leaks of privacy, but if you don’t keep them, you’re noncompliant. Dusk’s approach is pretty smart. It created a Citadel identity layer, combined with ZK selective disclosure—sounds not that complicated, right? It’s like going through security: you only need to prove there’s no knife in your bag; you don’t have to pull out your underwear for everyone to see. The credentials can prove you’re a “qualified investor,” but your passport number doesn’t need to be revealed.
Moonlight keeps the chain transparent, Phoenix handles privacy with UTXOs—audits can verify, and privacy is still preserved. I think this detail is especially well considered: the auditors can see what they’re supposed to see, but not what they shouldn’t.
But beyond the cryptography loop, the other issues are what really wear you down. The credential issuer whitelist currently has only seven organizations; adding one requires community voting. There’s also a revocation mechanism—if a credential becomes invalid, how do you synchronize it immediately? Cross-border regulatory mapping: how do MiFID and the SEC recognize each other? All of that depends on off-chain Oracles feeding the data. Sounds not that complicated, right? But regulatory back-and-forth can strip you down layer by layer.
Technically, the problem is solved for 70%. The remaining 30% is a real legal tug-of-war and regulatory negotiation. Writing the code is fast—but getting regulatory approval is slow. Don’t mistake cryptographic progress for real-world adoption progress.
Old Zhou later didn’t ask about the technical details again. He just said one thing: “I just want certainty—the certainty that proves my innocence.” You see, that’s harder to write than code, isn’t it?
#dusk $DUSK @Dusk
