The Broken Promise of DeFi

DeFi was supposed to be our escape. It promised a permissionless, borderless, bankless finance. A parallel world where control shifted from institutions to individuals. But DeFi forgot to lock the door behind us somewhere along the way.

Every on-chain action, from token transactions to staking yields, is visible to anyone with a block explorer and a basic blockchain understanding.

We escaped the bank, but walked straight into a glasshouse. And while we can still move our money freely, the world is watching.

What Is Private DeFi?

Private DeFi is what DeFi should have been from the start. It’s decentralized finance that doesn’t expose your wallet transactions and history.

At its core, Private DeFi leverages zero-knowledge proofs and advanced cryptographic protocols to allow transactions and contract interactions that are verifiable, but not transparent.

With private DeFi, we can operate on the blockchain with improved ownership and a sense of being back in control.

Why We Need Private DeFi

Blockchain transparency made a lot of sense when it was introduced until it didn’t.

According to data from Statista , DeFi exploded in 2021 with over 7.5 million unique users and $175 billion locked into protocols like Uniswap and Aave. But in 2023, those numbers shrank dramatically. Usage dropped, and the total value locked fell to just $50 billion.

Sure, market crashes and the collapse of platforms like FTX and LUNA worried many of us. But there’s another issue: people realized DeFi isn't private. Every wallet, transaction, and strategy is publicly visible, indexed, and traceable.

Total transparency on public blockchains means institutions’ trading strategies can be copied, your net worth tracked, and your wallet relationships mapped to reveal who you are outside the blockchain.

This exposure is a total dealbreaker for institutional investors and many individual investors. And yet, onchain financial systems continue to use the privacy ethics of a public leaderboard.

What Happens Without Private DeFi?

• Front-running bots (MEV bots) feast on your transactions before they confirm, performing what is known as sandwich attacks.

• Hackers build entire attack vectors just by watching your habits.

• And governments view current DeFi protocols as fertile ground for money laundering and evading regulation.

There are countless cases of sandwich attacks where users lose hundreds of thousands of dollars when they try to swap from liquidity pools.

For example, in March 2025, a DeFi trader attempted to swap 732,000 USDC for USDT on Uniswap. However, the trader received only 19,000 USDT due to a sandwich attack, resulting in a loss of over $700,000. The attack was facilitated by setting a 100% slippage tolerance, allowing MEV bots to manipulate the transaction significantly.

And in September 2023, BNB Smart Chain set a new record for daily block production. The problem was that the surge coincided with a flood of sandwich attacks.

MEV bots front-run user trades on the BNB Smart Chain to extract profit by manipulating token prices. The scale of the problem was revealed when reports of a single bot siphoning $40 million appeared. These funds came from over 100,000 users being affected by sandwich attacks in a period of just three months.

Every year, onchain data reveals MEV bots front-running high-net-worth wallets by spying on their activity and taking advantage of blockchain technicalities to capture arbitrage opportunities.

This must be stopped.

How Horizen Helps

We’re launching Horizen on Base, the first appchain specialized in privacy, designed to make private DeFi a reality. Most DeFi apps run on public blockchains where every move is exposed, but we’re building something different.

Our move to Base will give developers tools and access to the world’s largest DeFi ecosystem, where users will be able to trade, lend, and move assets without putting all their activity on display.

With Horizen, DeFi will work like it should.

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