Trading volumes in crypto derivatives markets have surged to over $23 trillion annually, becoming one of the most dynamic and liquid segments in digital finance. Massive institutional capital flows have poured in with no signs of slowing down, taking advantage of 24/7 market access and unprecedented capital efficiencies that traditional markets cannot match. This new era of finance enables institutions to seize new market opportunities in real-time like never before.
Yet this represents just the tip of the iceberg. The global capital markets across equity, fixed income, and debt capital markets total over $500 trillion - dwarfing current on-chain activity by orders of magnitude. Today’s ~$22 billion in tokenized real-world assets (on non-Canton) public chains barely scratches the surface of what’s possible when institutions start to access, mobilize and convert tokenized assets and stablecoins at scale, 24/7.
But as sophisticated players look to scale their on-chain operations, the lack of control over privacy is a critical roadblock: existing public networks either offer no privacy protections, or rely on bolt-on privacy solutions that do not scale and fall short of institutional standards. From zero-day security bugs in cryptographic privacy solutions, to recognition from major institutions and regulators that programmable, granular privacy controls are crucial to ramping up adoption, it is rapidly becoming the major theme for institutional adoption in 2025.
At The Tie’s Bridge event, the head of trading at leading market maker Galaxy talked to the importance of privacy and confidential on-chain collateral movements to drive the next wave of institutional adoption of crypto derivatives. Privacy isn’t just a regulatory checkbox; it is essential for protecting sensitive trading strategies on-chain. Without it, traders risk front-running, being on the wrong side of the trade, and being exposed to unfair trading practices that can lead to significant losses.
With Canton Network, you no longer have to compromise. It has been architected with a privacy-first approach at the native protocol level, enabling institutional crypto to get built-in privacy that scales. On Canton Network, institutions are able to confidentially post their collateral on-chain, to unlock the benefits of yield-generating collateral, continuous and instant margining with the capital efficiencies of shorter cycles, all while preserving the privacy that institutions demand. Your transactions will only be visible to the parties involved in the transaction, preventing front-running risk. With Canton, institutions are confidently scaling their on-chain operations to institutional volumes, unlocking the mass on-chain adoption that the industry has been waiting for.
Most layer 1 blockchains offer incomplete privacy solutions with interoperability and auditability trade-offs. They were designed for transparency and not confidentiality which makes them unsuitable for institutional collateral management:
Canton Network exists on a category of its own as the only platform that has been designed from the ground up for institutional-grade privacy needs. Canton’s foundational approach to privacy delivers the confidentiality, auditability, and interoperability that financial institutions need for high quality tokenized assets and tokenized cash to convert and flow 24/7 on-chain.
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The ZKP ‘Black Box’ Challenge |
Canton: Selective Disclosure Proven at Scale |
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Fig 1. ZKP’s “black box” challenge vs. Canton’s selective disclosure
Unlike other networks that have bolt-on ZKP-based “all-or-nothing” privacy at the app-level, Canton’s privacy is implemented at the native protocol level. Importantly, this allows for highly granular selective disclosures at the sub-transaction level, providing the capability for institutions to define who sees what on a need-to-know per-participant basis.
Why does it matter? Your collateral positions, allocation strategies, and client relationships remain strictly confidential. When you post collateral against a crypto derivatives position on Canton, only the parties involved in the transaction can see that transaction.
Canton Network eliminates the trade-off between privacy and compliance. It provides protocol-level privacy while preserving full traceability of transactions for compliance reporting and regulatory needs. Canton allows you to selectively disclose transaction history for trusted parties’ viewing only.
Why does it matter? You can satisfy regulatory reporting requirements for collateral positions while maintaining confidentiality against competitors. Collateral flows must be traceable for regulators and auditors, under MiCA, EMIR, and Basel III regulations.
Fig 2. Canton’s network of network’s architecture enables privacy with composability
Canton Network is designed with native privacy and composability at the protocol level. Its “network of networks” design is the foundation that makes privacy with composability possible, resolving the trade-off that L1s typically have to make. The “network of networks” design enables applications to natively compose with each other while preserving the sub-transaction level privacy. Each application on Canton Network can enforce its own confidentiality rules, yet also be able to compose with other applications and synchronize data.
Why does this matter? Unlocks 24/7 on-chain capital markets with privacy, with instant and real-time asset convertibility across stablecoins and tokenized assets. Collateral can flow securely across lending applications, clearing houses, custody platforms, and more. Composability enables atomic settlement, which is a big unlock for capital markets as it enables multiple legs of a transaction to be instantly completed in one transaction, all while preserving the privacy that you need.
As institutional crypto market participants race to bring their workflows on-chain to unlock the full potential of 24/7 capital markets, privacy is no longer a nice-to-have, it is a critical requirement that enables institutional participants to trade with confidence, deploy on-chain collateral confidentially, and scale without exposing sensitive strategies or positions.
Canton Network is purpose-built for this new financial paradigm shift. It empowers financial institutions to operate on-chain as they do in the TradFi world: privately and in compliance with regulatory standards, all while unlocking the efficiencies and interoperabilities of the DeFi world.
In this new financial paradigm, those who get privacy right will lead. Only Canton Network delivers.
Interested in connecting to the Canton Network? Discover different ways to participate and how to get started here.