Chainlink introduces private transactions for secure cross-chain use

Chainlink (CRYPTO:LINK) has introduced a new privacy-focused feature called CCIP Private Transactions, leveraging its Blockchain Privacy Manager to facilitate secure cross-chain transactions. 

This new capability aims to help financial institutions maintain data confidentiality, integrity, and regulatory compliance when conducting blockchain-based transactions.

One of the first institutions to test this technology is the Australia and New Zealand Banking Group (ANZ). 

The bank is set to use CCIP Private Transactions for cross-chain settlement of tokenised real-world assets (RWAs) as part of the Monetary Authority of Singapore’s (MAS) Project Guardian initiative.

According to Chainlink, financial institutions have faced challenges in securely managing cross-chain transactions due to the lack of secure privacy solutions. 

Regulations like GDPR and MiFID II demand strict privacy for transactions, especially when they involve interactions between private and public blockchains.

To address this gap, Chainlink developed the Blockchain Privacy Manager, which connects private chains to both public and private networks through the Chainlink CCIP platform.

The privacy feature uses an encryption and decryption protocol that supports secure cross-chain transactions, protecting transaction details such as data, token amounts, and counterparties. 

This capability allows institutions to set privacy parameters, ensuring that sensitive information is only accessible to authorised compliance authorities.

Chainlink representatives explained that institutional privacy has been a significant obstacle to blockchain adoption. 

They believe that CCIP Private Transactions could open the door to broader institutional use of blockchain technology by overcoming long-standing privacy concerns.

ANZ officials expressed optimism about the feature, emphasising that it could greatly enhance the use of blockchain networks for financial institutions.

At the time of writing, the Chainlink price was $11.68.