Huihui_Host of EncryptClub：Privacy protection is a key infrastructure for the crypto world to map the real world while “available but invisible” is also a necessary condition for data to realize its economic value. On January 10, Barry Silbert, the founder of the Grayscale Fundation, publicly declared on Twitter that 2021 will be a year of privacy protection, decentralization and censorship resistance. Brian Armstrong, CEO of Coinbase, said: “It doesn’t make sense in most cases to broadcast every payment you make on a transparent ledger.” It means that in most cases, every transaction record should not be made completely public on the blockchain, but it takes an extremely long time to realize the privacy protection of the most basic personal transaction data due to higher technological thresholds and use costs. Recently, Tonardo.Cash and Suter Shield have made significant progress in the productization of private transaction, greatly accelerating the application of privacy protection. Today it’s my honor to invite Dr. Huang Lin, CTO of Suterusu, to talk about the topic “Why Suter Shield is the privacy guard of the BSC public chain” .
Q1：Welcome to EncryptClub community, Dr. Lin. The most eye-catching event in recent privacy track is that Tornado Cash, the privacy trading platform, airdropped TORN token on February 10th. Its price in the secondary market once hit 300 USD; according to the information on the Tonardo.Cash website, 500,000 tokens were airdropped with a total value of 150 million USD. What is the reason that brings the most valuable airdrop in the DeFi field?
Dr. Huang Lin：Dr. Huang Lin: First, I would like to thank for the support of EncryptClub to carry out this AMA. We hope that more people will pay attention to Suter’s upcoming privacy layout on the BSC ecosystem. At present, we have launched the world’s first privacy protection Layer 2 network on Binance Smart Chain (BSC). Users can use Suter Shield on BSC to complete transaction protection. At the same time, we will cooperate with other projects in the Binance ecosystem such as Dex, Wallet, loans, insurance and liquidity mining, including the privacy liquidity mining to be launched on BSC in about a week. Packshield, the world’s best blockchain security and audit company, is currently undergoing a final audit and has completed the test already, and we are waiting for their compliance report now.
Regarding TORN, such data are overstated. At present, TORN’s circulating stock value is about 70 million USD, but their current circulating stock only accounts for 3% with over 50% of the tokens given to DAO. Currently Suter’s circulating stock is up to 37% with 8% of the Team & Foundation token all locked until the end of 2022. In future over 50% of tokens will be generated through privacy mining, making our wealth creation effect much better than that of TORN, because more incentives are left for the Suter holders. Of course, TORN’s current TVL, about 300 million USD, is good. This is obviously inseparable from the huge application prospect of the privacy protection track and the acceleration effect brought by technological innovation to privacy protection applications.
In fact, Suter Shield’s market response is enthusiastic with extremely rapid growth. Since Suter Shield’s launch on January 14, 2021, over 1,000 users, about 1/10 of Tornado.Cash users, have registered with accumulated transaction amount of nearly 30 million USDT and daily TVL of over one million USD, far exceeding the level of Tornado.Cash in the first three months after its launch. The huge market space brought by private transactions has already emerged. At present, TORN has Fully Diluted Cap of 3 billion USD while Suter has Fully Diluted Cap of only 100 million USD, and the circulating stock value of 40 million USD. Starting with liquidity mining in BSC and other ecosystems, we aim to shorten the gap or even exceed our comprehensive data with those of TORN within half a year.
Q2：Congratulations to Suter Shield for having such a huge market breakthrough. But the advanced technology of the privacy track is the main judgment criterion for market dominance. Are there any products of Tonardo.Cash and Suter.Shield already available? What kind of functions do these products have? Can Dr. Lin share some information in this aspect?
Dr. Huang Lin：We are very confident in our technology. Our team members have been deeply cultivating in the field of cryptography and privacy protection for over 10 years. Currently, some of our original technologies are far ahead of similar projects including Tornado.Cash. Privacy technology is the most complicated and challenging technology in the blockchain field. I’m about to talk about some terms in our following discussion, so I will try to make them simple. The blockchain privacy track appeared quite early, a bit later after Bitcoin inception but even earlier than Ethereum, Monero and Dash, featuring anonymous transactions, have already appeared. Subject to privacy computing technology and the maturity of the entire blockchain ecosystem, the above two projects and Zcash mentioned by Barry Silbert can only provide anonymous transactions for the digital currency issued by themselves with more or less functions and security vulnerabilities. For example, Dash cannot conceal the transaction amount. Zcash’s zkp is based on trusted presupposition with a large security risk. Even Monero is only a non-scalable technical architecture. Its privacy protection solution, therefore, cannot be a service provided to the outside world. The contribution of Tonardo.Cash is to bring privacy protection transactions to the Ethereum ecosystem, but this service is only applicable to Ethereum, and it still fails to solve the security risks caused by trusted presupposition. The trusted setting is equivalent to a hidden bomb. Once the attacker steals the trapdoor information of the trusted initialization setting step, the bomb will be set off. And the attacker can use it to launch an undetectable double-spending attack. Comparatively speaking, based on the original ZK-ConSNARK solution without trusted initialization settings, Suter Shield takes 20% less space than similar solutions with 10 times increase in computing efficiency, fundamentally guaranteeing the security and transparency of the solution as well as the efficient operation of the system. The Suterusu Protocol technical solutions have been completed by myself in cooperation with researchers from Centre National de la Recherche Scientifique (CNRS) and cryptographic experts from theKarlsruhe Institute of Technology (KIT) in Germany with relevant academic papers included in Eurocrypt2021, a top international cryptography conference. Suter Shield’s solutions has obvious advantages both academically and engineering-wise. It is indeed a high-quality project with hard-core technology.
At the same time, I believe that many people will ask what to do if privacy protection is abused, such as hackers and money laundering. Does Suter have any measures to solve this problem, that is, can it ensure the most basic privacy of users as well as meet the regulatory requirements at the same time? We need to emphasize that the Suter Network governance token is not a privacy currency, but an erc20 token. As a Layer-2 network based on Suterusu Protocol’s zero-knowledge proof protocol, Suter Shield is compatible with almost all public chains supporting EVM, such as Ethereum and today’s BSC. Thus, we will deploy our protocol on other public chains in the future. For all transaction addresses involved in the Suter protocol, we have established a blacklist system since Day1. It is also the anti-money laundering security standard most recognized in the industry, that is, we recognize the address instead of a user’s personal identity as an account. As we know, the compliance of Binance’s Fiat Currency System also requires account address tracing. Though we cannot see the individual transaction addresses of the entire network manually, the system would automatically identify and compare the blacklist library of the industry as long as an address in the blacklist of platforms such as Chainalysis appears. (We have registered Chainalysis Reactor Certification (CRC). We will automatically suspend deposits and withdrawals at this address. This is the biggest difference from TORN. We also contact providers, exchanges, and project parties in the blacklist of some other chain to make every effort to prevent similar incidents, i.e., Hacker steals money from Cream and transfers it into TORN for money laundering, from occurring at Suter Shield.
Q3：Our topic today is “Why Suter Shield is the privacy guard of the BSC public chain”. At present, Suter’s technical strength is the premise for the establishment of a privacy protection infrastructure for BSC. So how does Suter Shield output privacy protection services for BSC?
Dr. Huang Lin：First, I would jump to the conclusion that Suter Shield decides to support all the BSC projects on BSC with providing network-wide privacy protection and payment solutions and soon simultaneously starting private transaction mining on BSC, not only because Binance’s user number and the efficiency and scenario coverage of BSC are amazing. It is conservatively estimated that BSC covers at least 30% of the market share. It is more important that BSC can provide an efficient and low-cost network bottom layer, and greatly reduce transaction fees. We are confident to meet the basic privacy needs of tens of millions of users on the BSC, and ensure everyone’s transaction privacy and security.
Suter Shield is the world’s first Layer 2 privacy transaction product. After its launch on January 14, it could provide privacy transaction services for Ethereum. In addition, as Suter Shield’s technical solution is universal and can support private BTC cross-chain payment functions, now it can also provide private transaction services for BSC. The specific meaning of providing private transaction services means that Suter Shield can provide privacy transfer services for various tokens that comply with the BEP-2 standard. For example, it can provide coin shuffle services for CAKE transaction users to ensure the privacy of account information and transaction amount of users participating in the transaction and to avoid the disclosure of these information on the blockchain; it can provide protection for the positions of the users who join the loan on Cream. Only users know about the use of the loan but they don’t need to frequently use new accounts. The frequent use will increase the difficulty of operation. In fact, this kind of old-style privacy protection solution is inefficient and unreliable, for the new accounts are still be associated. But Suter Shield is capable of quickly combining with multiple ecology and multiple scenarios to output privacy protection. In this case, a key step for privacy transactions towards the application is that privacy protection can be output as a service. Suter Shield is such a unique product with this capability.
Q4：Outputting multi-scenario and multi-ecological privacy protection service is the strongest advantage of Suter Shield as a Layer 2 privacy trading product. What are the similarities and differences between Suter Shield and Tonardo.Cash in terms of privacy protection functions?
Dr. Huang Lin：As Tonardo.Cash completely focuses on the Ethereum ecology, it has obtained the support of some early users of the Ethereum community, and has a certain preemptive advantage (probably ranked 10th among all DeFi products) on TVL and transaction volume. But Tonardo.Cash only provides coin shuffle business for ETH and a few currencies without supporting transaction amount protection. Relatively speaking, Suter Shield can provide both transaction account and amount protection, indicating a stronger privacy protection function; Suter Shield can also provide privacy transfer function, that is, under the premise of protecting the transaction account and amount, any transfer less than the account amount can be made between different accounts while Tornado.Cash only allows users to transfer a fixed amount, such as 1, 10, and 100. A 589-transfer can be done with one effort in Suter while users need to divide 589 into 5 times of 100 plus 8 times of 10 and 9 times of 1, altogether 22 times of transfer at Tornado.Cash, which is excessively troublesome. So, in terms of applicability, our solution is a huge leap.
Cooperated with Ren, Suter Shield has already launched renBTC’s privacy payment solution. It will also support RenJS2.0 to open up all cross-chain assets on Ren. In the next step, Suter Shield will provide private transactions for DEX such as Uniswap or Sushiswap combination, and combine with Compoud to achieve privacy-protected loans. The integration of many projects into multiple DeFi scenarios will make the function of Suter Shield a service that can be reached by millions of users every day. There is only one core, that is, privacy is actually the basic needs of users. Suter Shield and Tornado.Cash are the only two products available in the market now, with the former launched after the later. Our strategy is to deeply cooperate with all traffic scenarios and BSC is our most important ecological scenario.
Q5：As a project with strong technological strength, Suterusu is definitely supported by many followers. How to participate in Suterusu’s ecological governance is also the most concerned issue of supporters. So, I hope Dr. Lin can give us a brief introduction in terms of SUTER token model and ecological governance.
Dr. Huang Lin：We believe that the value of tokens is based on products. Only when products can provide sufficiently powerful services can tokens capture more value. Tokens, however, are also affected by factors such as vesting rhythm and distribution proportion. The investment logic of privacy transaction tokens can be analyzed according to two dimensions: revenue model and token economy model. In terms of the revenue model, the basic service provided by both Tonardo.Cash and Suter Shield is transaction data protection. The basic business model is to charge certain commissions based on the token amounts involved in privacy transactions, so the user number and the type of supporting currency are the main factors that determine the scale of revenue. We have discussed this question when talking about product operations and won’t elaborate it.
In terms of token economy model, 76% of SUTER’s tokens are generated by mining (Currently over 20% of the tokens have been produced, and over 50% of the tokens will be generated through privacy mining subsequently). And the space governed by community has a greater chance to capture returns. Mining allocation ratio of TORN is only 15% (including 5% of airdrops), and 55% is released linearly in DAO. Though it is not explicitly explained by the project team, 55% is actually equivalent to the pre-mining targeting investment institutions. In this case, community governance rules are mainly determined by this part of the tokens.
Q6：As far as we know, Suter Shield will soon start “private transaction mining”. What are the details of this private transaction mining and how can supporters take part in?
Dr. Huang Lin：Each currency is awarded daily according to the participation amount of privacy mining; the accumulation of each user’s multi-currency rewards is the total amount of his/her daily personal rewards, and the user’s single currency mining all adopts Suter Shield’s privacy protocol for mining, because BSC cost is much lower than that of Ethereum. We estimate that mining on BSC is a choice with low-cost and objective profitability.
Q7： What incentives can Suter provide for early supporters?
Dr. Huang Lin：In the current market, the annual coin shuffle cap of Bitcoin in 2019 exceeded 36 million USD. In 2020, it increased by over 100% to 73 million USD. ETH and ERC20 tokens are still a blank in the market. At present, the amount of locked value in the Ethereum DeFi protocol exceeds 18 billion USD, and the Defi-related transactions have reached 100 billion USD. Imagine that if 1% of the transactions adopts Suterusu Protocol, how much annual revenue would Suterusu Shield reach? At present, as the SUTER node lock-up tokens have been fully circulated, the original 5,000+ Suter wallet users will be directly converted into Suter Shield users who can directly take part in the ecological construction by joining private transaction mining.
In the short term, we will pay attention to the upcoming synchronous privacy mining on BSC and Ethereum. APY for early users is definitely satisfactory.
Q8：At the last of our AMA, we would like Dr. Lin to share the next step of Suterusu project.
Dr. Huang Lin：Suterusu’s development will focus on two dimensions. One is the docking at the protocol level. Suterusu Protocol itself is positioned as a Layer 2 network on Ethereum. This protocol layer can be compared to a “plugin” similar to the way Chainlink is used on the oracle track. Suterusu Protocol can be embedded in all BSC projects as a plugin for data and transaction privacy protection. At the same time, if both BSC and more public chains can support virtual machine VM technology, Suterusu Protocol can be used. Regarding this aspect, we have docked with many famous projects, including Ren, Harmony, Elrond, Dfinity, Waves, Theta, and Link at the technical level in the past. Community users should stay focused in this aspect. Many big news will come out near future.
The second dimension is some application plugins developed by Suterusu, such as flash loans based on private transactions.
The third is to generate Mirror Assets from the assets stored in Suter Shield, carry out a series of financial services within the ecosystem that supports Suter Shield, and expand the income portfolio of users using Suter Shield.
We believe that Suterusu can bring to the blockchain or even the technological world a product that addresses pain points and user needs as well as meets regulatory requirements. We create a protective suit for you when facing with the double-edged sword of technology. We can protect users’ transactions and information security, as well as adapt to the risk control requirements of traditional financial supervision. It is not only what Suterusu should do, but also what all blockchain institutions would care about. We believe that blockchain technology will definitely become the next five-year mainstream technology. When finance, consumption and entertainment are reconstructed and empowered on the blockchain, Suterusu will not only become the privacy protection infrastructure of DeFi, but also the underlying standard protocol of the entire blockchain ecosystem.
We believe that today’s products reserved with Suter’s long-term investment in technology will definitely become the next Link-level Defi and much-needed applications in the blockchain financial field. We hope that more project owners will connect with us if they have user privacy protection needs. It only takes about 24 hours to complete the docking test. Suter Shield is a protection shield for users. We believe that Suter will soon become the leader in the privacy Layer 2 global market. Thank you for paying attention to Suter, log in to BSC and take part in our privacy mining!
Here comes the free QA session, guest can choose 2 lucky questions to give a brief reply.
User1：What is the relationship between privacy and DeFi? Why is it called Suterusu? Does Suter have any incentives for community growth?
Dr.Huang Lin：Privacy is a necessary prerequisite for DeFi. According to the current development trend, privacy protection DeFi will definitely become a hot spot for crypto. Suterusu means invisible in Japanese.Community incentives are mainly the privacy mining and xsuter token dividend mechanism we just mentioned.
User2： What is the value of Suter?
Dr. Huang Lin：Our technology is ahead of other similar projects. It includes our academic articles published in Eurocrypt 2021, the world’s top cryptology conference and our superior engineering implementation capabilities. In light of business models, compared with similar projects such as Tornado.Cash, it has stronger security and applicability, and is compatible with all EVM public chains, so it has the chance to become a privacy protection DeFi infrastructure similar to that of Chainlink. Finally, of course, a quite novel mining mechanism is adopted to encourage and attract community participation.
Huihui_Host of EncryptClub: Thank Dr. Lin for joining our AMA and sharing so much valuable information with us. Thank you all for watching this AMA. EncryptClub will work hard and bring more wonderful content for you in future.