Balancing Privacy Protection and Transparent Compliance
Huabai Blockchain ｜ Date: August 29, 2025 ｜ Multi-Track Asset Observer / Structured Investment Researcher
Cross-border payments involve sensitive information from merchants, consumer payment data, and funding paths. This data needs to protect privacy while also meeting the scrutiny requirements of regulatory agencies. Traditional financial institutions often lean towards privacy protection but sacrifice transparency; while some emerging solutions, though transparent, overlook business privacy. @Huma Finance 🟣 proposes a path that balances both in the PayFi network.
Huma's approach is to employ data layering and encrypted hash mechanisms. Fund transactions are transparently visible on-chain, but information related to merchant and user privacy is encrypted, retaining only the hash values needed for verification. This ensures that compliance checks and audits can proceed smoothly while sensitive data remains undisclosed.
Moreover, Huma is actively exploring privacy computing methods such as zero-knowledge proofs, allowing regulatory bodies to verify the legitimacy of funds without directly accessing user privacy information. The significance of this mechanism lies in its ability to maintain decentralized transparency in the payment network while protecting the commercial interests of participants. In the future, as more markets emphasize privacy compliance, Huma's model will demonstrate greater competitiveness.
