Confidential Balances

What are Confidential Balances?

Confidential Balances is a Token-2022 extension that lets you transfer tokens between token accounts without revealing the transfer amount. This is useful for privacy-preserving transactions. Only transfer amounts and token balances are private. Token account addresses remain public.

• Protocol Overview - Details on the underlying cryptographic protocol
• Quick Start Guide - Setup and basic CLI commands
• Confidential Balances Cookbook - Code snippets showing how to use Confidential Balances

How does it work?

The Confidential Balances extension adds instructions to the Token Extension program that allows you to transfer tokens between accounts without revealing the transfer amount.

The basic flow of confidential token transfers is as follows:

1. Create a mint account with Confidential Balances enabled.
2. Create token accounts with Confidential Balances enabled for the sender and recipient.
3. Mint tokens to the sender account.
4. Deposit sender's public balance to confidential pending balance.
5. Apply sender's pending balance to confidential available balance.
6. Confidentially transfer tokens from sender token account to recipient token account.
7. Apply recipient's pending balance to confidential available balance.
8. Withdraw recipient's confidential available balance to public balance.

Auditor keys

A Confidential Balances mint can store an optional global auditor ElGamal public key. When one is configured, every confidential transfer includes the amount encrypted for the sender, recipient, and auditor. The transfer proof verifies that all three ciphertexts contain the same amount. The public still cannot read the amount, but the holder of the auditor secret key can decrypt transfer amounts for that mint.

The Confidential Balances authority sets the auditor key when initializing the extension or changes it later with UpdateMint. The authority can rotate or clear the key. A rotation applies only to future transfers, so retain prior secret keys when historical audit access is required. Auditor keys provide read access; they do not authorize token transfers or reveal an account's full confidential balance.

For setup and rotation examples, see Configure an auditor. Wallets, explorers, exchanges, and compliance providers should also review the auditor integration guidance.

For more details on the steps in the confidential transfer flow, see the corresponding pages:

The diagram below shows a detailed sequence of the basic flow for confidential token transfers:

Confidential Balances Instructions

The full list of Confidential Balances extension instructions is as follows: