What is COTI (COTI)?

Deep Dive

1. Purpose & Value Proposition

COTI’s fundamental purpose is to solve the privacy dilemma on public blockchains. While transparency is a core tenet of crypto, it exposes sensitive data like transaction amounts, trading positions, and business logic. COTI positions itself as the missing privacy infrastructure, enabling what it terms "Programmable Privacy." This allows developers and institutions to build applications where data is encrypted by default, yet can be selectively disclosed for audits or compliance, making blockchain viable for enterprise and high-value use cases.

2. Technology & Architecture

At its core, COTI V2 is an Ethereum Virtual Machine (EVM)-compatible Layer 2. Its key innovation is the use of Garbled Circuits (COTI), a cryptographic technique that processes encrypted data without decrypting it. The project claims this method is significantly faster and lighter than alternatives like zero-knowledge proofs (ZK-SNARKs). Transactions are computed off-chain for privacy and speed, with finality secured by settling proofs on the Ethereum mainnet. This architecture aims to balance strong confidentiality with the security and composability of Ethereum.

3. Ecosystem & Key Differentiators

COTI is evolving from a payments network into a full-stack privacy ecosystem. Key differentiators include its focus on compliance-ready privacy for institutions and its active growth initiatives like the COTI Builders Program. Its technology is being applied to specific verticals: it is the technical provider for Cardano’s Djed stablecoin, powers private perpetual DEXs like PriveX, and is targeting the tokenization of real-world assets (RWAs) through memberships in coalitions like the Tokenized Asset Coalition (TAC).

Conclusion

COTI is fundamentally a specialized privacy engine for Ethereum, designed to bring confidential and compliant computation to the forefront of Web3 adoption. As regulatory and institutional interest in blockchain grows, will its architecture become the standard for privacy-sensitive financial applications?