The internet has provided us with convenience, but it has also deprived us of tranquility. The same contradiction is playing out in the world of digital assets—we want speed and transparency, but we also fear exposure under the spotlight, worried that every transaction could become a handle for regulators. This dilemma leaves many people torn in the blockchain world.

Is there a way to break this deadlock? Some projects are trying a different approach. Since 2018, they have been asking the same question: can we build a blockchain infrastructure that respects privacy while complying with regulatory frameworks?

**Modular Solutions**

Traditional blockchains often present a binary choice—either complete transparency (at the cost of privacy) or full anonymity (at the risk of regulatory nightmares). Modular design breaks this deadlock.

Imagine a system where its core functions—consensus mechanisms, transaction execution, privacy protection—are like LEGO bricks that can be flexibly assembled and disassembled. What are the benefits of this approach? Developers can freely adjust privacy levels and compliance according to different financial scenarios. For scenarios requiring more privacy, they can strengthen that aspect; for those needing better integration with traditional finance, they can optimize compliance.

This is not an idealized concept. Layer 1 blockchains adopting this approach are precisely aimed at serving an increasingly urgent need—the development of regulated, institutional-grade privacy financial infrastructure. As traditional financial institutions gradually explore blockchain applications, such flexibility is becoming more and more feasible.