Sora Ventures leads a $5 million investment in Silent Protocol, bridging traditional finance and DeFi with a privacy-focused approach.

Turkish startup company Silent Protocol is developing a scalable privacy layer to bridge traditional banks with decentralized finance (DeFi). The solution aims to help financial institutions securely enter the Web3 space, providing customers with a pathway to access Web3 products while safeguarding data privacy.

Sora Ventures leads Silent Protocol to pioneer the DeFi privacy era

Silent Protocol, a new project led by researchers from the Turkish Scientific and Technological Research Council TÜBİTAK BİLGEM, is bridging the gap between traditional banking and decentralized finance (DeFi) with innovative privacy solutions.

The core objective of Silent Protocol is to develop a scalable privacy layer to support existing applications and eliminate the need for liquidity from existing fund pool exchanges.

This project, launched in 2021, has attracted investments from several venture capital firms, including Zee Prime Capital, Mechanism Capital, Hypersphere, and Daedalus, providing initial funding. In a $5 million funding round led by Sora Ventures, Silent Protocol aims to further expand into Web3 and beyond.

Key for financial institutions exploring blockchain and DeFi: Privacy

Since 2014, financial institutions have been researching blockchain technology to address infrastructure bottlenecks. Many believe that without robust data privacy protection, the widespread application of blockchain would be nearly impossible. As a result, most banks are collaborating through private or consortium blockchains, such as Corda developed by R3 and Fabric developed by the Hyperledger Foundation.

Despite the relatively high costs and experimental nature of these collaborations, they still represent an important step in blockchain application.

As time progresses, financial institutions have come to realize that significant breakthroughs in blockchain adoption require active utilization of public chains. This is why, for example, Ripple's unique cross-border payment approach has become the preferred choice for important financial institutions, including SBI Holdings. Additionally, this trend is not limited to adopting existing public blockchain platforms; the growth and potential of Web3 create a new investment area, making major banks aware of the existence of DeFi products and seeking change to maintain competitiveness in the Web3 market.

Silent Protocol: Catalyst for institutions entering the Web3 era

Silent Protocol provides crucial data privacy protection for financial institutions entering the Web3 space.

Unlike other zk solutions that require asset migration to their protocols, Silent Protocol is developing a level that allows existing decentralized applications (dapps) to maintain liquidity and expand using zk solutions.

This framework is a more practical business model, acting more like a "support layer" rather than a "competitive layer" that requires dividing existing DeFi liquidity. Through Silent Protocol, banks and other financial institutions can develop their dapps using a robust privacy protection layer, allowing customers to access Web3 products and ensuring data privacy on public blockchains while concealing transaction traces.

Silent Protocol plans to release its pending patent EZEE economic zero-knowledge execution environment framework in the fourth quarter of 2023, providing institutions with an environment to test privacy-compliant solutions and expand their existing Web3 products. As the Web3 landscape evolves, Silent Protocol's approach will offer a privacy layer that can scale without the need for liquidity exchanges, potentially changing the way traditional financial institutions interact with the DeFi sector.