Story perspectives

Balancing Privacy and Compliance in Decentralized Stablecoins

11/10/2025

Summary

Story summary

Compliance-by-design embeds compliance mechanisms directly into decentralized stablecoin payment systems, enabling real-time enforcement based on predefined criteria.
The approach highlights the tension between privacy and legal compliance, especially AML and CFT regulations.
Key challenges include the computational costs of privacy-preserving technologies and the need for trusted credential issuers.
Zero-knowledge proofs could enhance privacy while ensuring compliance, but balance remains complex and requires governance.

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Story summary

Compliance-by-design embeds compliance mechanisms directly into decentralized stablecoin payment systems, enabling real-time enforcement based on predefined criteria.
The approach highlights the tension between privacy and legal compliance, especially AML and CFT regulations.
Key challenges include the computational costs of privacy-preserving technologies and the need for trusted credential issuers.
Zero-knowledge proofs could enhance privacy while ensuring compliance, but balance remains complex and requires governance.