Privacy Wallet and Crypto Card Service Provider Payy Announce Launch of a Privacy-Focused Ethereum Layer 2 Network, Now Directly Integrable with MetaMask. The network defaults to privacy-preserving ERC-20 token transfers without requiring any modifications to existing smart contracts, aiming to enable on-chain financial activities to remain compliant while minimizing external traceability.
Payy states that in the past, privacy often meant complex experiences, fragmented liquidity, or poor compatibility. This network’s underlying architecture allows “privacy to run in the background.” Its system automatically routes user transactions to private ERC-20 liquidity pools, hiding the true flow of funds; when users interact with DeFi protocols, assets are transferred to newly generated addresses, further reducing on-chain linkability. Related private data is stored in an off-chain privacy vault, allowing users to choose different privacy and compliance combinations based on their needs.
The network primarily targets two user groups: first, institutions and FinTech companies that want to bring fund flows on-chain but do not want to expose transaction trails; second, privacy-focused users seeking a simplified experience. Crypto-native users can continue using existing wallets and applications, while traditional financial institutions can access via distribution partners. Payy plans to leverage its current base of approximately 100,000 wallet users and multiple stablecoin participants as initial liquidity.
Payy CEO Sid Gandhi pointed out that privacy is a key barrier to large-scale adoption of blockchain. Protecting transaction information without sacrificing compliance could help push the on-chain adoption of the global payment system, which is valued at trillions of dollars.
As privacy assets like Monero and Zcash show signs of revival in 2025, and as the Ethereum ecosystem continues to advance wallet-level privacy features, Payy’s launch is seen as another signal that privacy infrastructure is returning to the forefront, providing a new practical path for Ethereum Layer 2 privacy applications.
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