Sometimes I wonder why big banks like JPMorgan Chase and Citibank always maintain a reserved attitude towards DeFi. After looking into some information, I finally understood that the core issue lies in the "privacy" barrier.

The situation is quite awkward: either make everything transparent, which would expose business secrets; or pursue complete anonymity, which easily risks regulatory violations. Both extremes are blocked.

However, there is a team trying to break the deadlock. They launched the Hedger module, which uses a different approach — not relying solely on zero-knowledge proofs, but cleverly integrating technologies like homomorphic encryption. The result is quite interesting: transaction amounts are fully hidden, yet calculations can still be performed.

This way, regulatory authorities can see the transaction process during audits, but other market observers cannot see through your numbers at all. It balances privacy protection with compliance requirements. This idea of "controllable privacy" might just be the key for traditional finance and DeFi to open the door to cooperation.