Sui (SUI) launched public testing of confidential transfers on June 8. The feature hides transaction amounts and token balances on the blockchain but does not conceal sender and recipient addresses.
This distinguishes Sui from privacy coins like Monero (XMR). There, the focus is on near-total anonymity, while Sui tries to find a middle ground: hiding sensitive financial data but leaving verification tools for exchanges, analytics firms, and regulators.
The developers are clearly not targeting an audience seeking maximum anonymity, but rather institutional market participants. For them, privacy is important, but going completely dark could create compliance issues.
Privacy Model With Regulatory Compliance in Mind
Confidential transfers allow token issuers to enable a mode in which balances and transfer amounts are encrypted on the Sui network. At the same time, participant addresses, token type, and transaction time remain public.
The team’s announcement states:
“Confidential transfers are already available in the public beta on Devnet. Launch on Testnet is planned later this year.”
Encryption is handled by Twisted ElGamal based on Ristretto255 along with zero-knowledge proofs. Thanks to this, the network can verify that a transfer is correct without revealing its amount.
Such a mechanism is needed to prevent overspending or unauthorized issuance of new tokens. In other words, the protocol sees that the operation is valid but does not show unnecessary details to all network participants.
Mysten Labs has already published the source code on GitHub. However, the system has not yet undergone an independent audit, and the developers note that work on it is still ongoing.
How Sui’s Approach Differs From Monero
Monero hides several parts of a transaction at once. Ring signatures hide the sender, stealth addresses mask the recipient, and ring confidential transactions obscure the transfer amount. An outside observer cannot simply decrypt this data.
With Sui the logic is different. The network hides the balance and transfer amount but leaves addresses, token type, and transaction time public. This format is less radical but easier for companies that need to comply with regulations.
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Monero’s full anonymity has repeatedly become a problem for listing on major platforms. Exchanges fear regulatory pressure and are increasingly refusing privacy coins because it is harder to conduct financial monitoring with them.
Against this backdrop, the market has already seen several waves of privacy cryptocurrency delistings. After such decisions, some investors switched between different anonymous assets, and the sector experienced new spikes in volatility.
Additional pressure on Monero came from the news of XMR being delisted from Binance. After the exchange’s announcement, the token lost about 30% in a day.
Binance explained the decision by saying the asset no longer meets the platform’s requirements. But in the crypto community, many believe the real reason is related to regulatory risks around anonymous payments.
Monero remains one of the most well-known coins for private transfers. That is why the project regularly attracts the attention of regulators. At the same time, XMR supporters are confident that the market still underestimates the importance of financial privacy.
In their opinion, the value of such tools becomes obvious only when it is already too late for users to think about protecting their financial data.
Monero drops after Binance announces delisting. Source: X, Crypto Tea.
Sui is taking a different path. Token issuers can add audit keys so authorized parties can decrypt balance data if necessary. They also retain the ability to freeze and forcibly seize assets.
At the same time, users can confirm a balance or transfer amount without revealing their keys. For institutional clients, this may be a convenient compromise between privacy and control.
Why This Is Interesting for Issuers and Institutional Investors
This format may interest payment companies, stablecoin issuers, and teams managing large corporate reserves. It is not always convenient for them to show all transfers on a public blockchain.
Public balances can reveal a company’s strategy, and large transactions sometimes show business relationships before the business itself is ready to talk about them. For funds, payment services, and token issuers, this can be a serious problem.
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Interest in the technology is already being shown by Bridge. The platform is exploring how to use confidential transfers in stablecoin and payment infrastructure.
TRM Labs and Merkle Science are also testing the new model. Their task is to understand how risk assessment, transaction monitoring, and investigations will work under these conditions. For Sui this is an important point: if analytics companies can work properly with partially hidden data, it will be easier for institutional players to adopt this feature.
But the launch comes at a turbulent time for the network. At the end of May, Sui faced three outages in its main blockchain. Therefore, trust in the new feature will depend not only on the idea itself but also on how stable the network proves to be going forward.
The success of confidential transfers will largely be decided by partners and regulators. If they accept the controlled privacy model, Sui will be able to offer companies a rare option: to hide important financial data without turning the network into a fully anonymous tool.
Sui price dynamics after the launch of confidential transfers. Source: CoinMarketCap.
After the launch of the confidential transfers feature, the SUI token rose by almost 5%. At the time of publication, it was trading around $0.75. The growth coincided with a general recovery in altcoins, so it is still difficult to say exactly how much the new feature affected the price.
