New ERC: Confidential Fungible Token Standard

ERCs
1

Summary

The team is proposing an specification for confidential fungible tokens that uses pointer-based amounts to maintain transaction privacy while enabling DeFi integration. This standard addresses the growing need for privacy-preserving token transfers on Ethereum without prescribing specific cryptographic implementations.

Key Features

The proposed standard introduces several novel concepts:

  • Pointer-based amounts: All token amounts are represented as bytes32 pointers rather than plaintext values, allowing implementation flexibility across various privacy mechanisms (FHE, zero-knowledge proofs, secure enclaves, etc.)

  • Time-limited operators: Instead of traditional approvals with specific amounts, the standard uses time-bounded operator permissions that expire automatically, reducing external system overhead and providing natural permission expiration

  • Comprehensive callback system: Transfer functions include andCall variants that enable rich smart contract interactions while maintaining confidentiality

  • Technology-agnostic design: The standard accommodates current and future privacy technologies without being tied to specific cryptographic assumptions

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