On October 25, Nocturne announced that it had raised some $6 million from a very impressive list of investors. But what is Nocturne? And is this the next big thing in the Ethereum landscape?
What is Nocturne?
A visit to Nocturne website features a very minimalist user interface, which only features a list of definitions of the term “nocturnal”, only a third of which refer to the project itself. However, a click on “how it works” gives some clarity on the project, the concrete details of which have yet to emerge…
In short, Nocturne is a new protocol developed to enable “private accounts” on Ethereum.
Blockchain is known for its transparency and Ethereum is no different. Blockchain mining tools, such as Etherescanhave made detailed information about an individual’s financial history and status available to anyone with an internet connection and inclination.
With Nocturne, Ethereum users can interact with the blockchain ecosystem while maintaining the privacy of their personal and sensitive information. Through the use of zero-knowledge technology, “Nocturne allows users to deposit or receive funds to private and stealth addresses under Nocturne contracts.”
How does Nocturne work?
Nocturnal white paper documents are comprehensive for such an early project and provide insight into the impressive architecture behind the project.
Simply put, Nocturne is a “private account abstraction protocol”.
For a user to take advantage of Nocturne’s privacy-preserving functionality, they must first deposit cryptocurrencies into Nocturne’s “Deposit Manager Agreement”. At the moment, an off-chain party must then approve the funds, deeming the transaction to be below a certain compliance risk threshold.
This is a first methodology to avoid illicit transactions. However, over time the process will become increasingly permissionless, with a new process, known as “proof of innocence”, at the heart of future plans for the protocol.
Once a deposit has been approved, privacy is preserved by performing all transactions through a single “Contract Teller” which aggregates private operations before passing them to the “Contract Handler”, which performs all other contract calls and , in doing so, preserves the privacy of the end user.
In reality, the mechanics that facilitate Nocturne’s impressive features are overall more complex and nuanced and, for those interested, a visit to the Nocturne site Documentation should provide greater clarity.
Why all this enthusiasm?
In addition to offering what appears to be a compelling use case, Nocturne has generated excitement in recent days thanks to a very impressive list of investors who participated in its recent funding round.
In this round, Nocturne raised $6 million to “fund the deployment and continued development of private accounts on Ethereum.” The round included impressive venture capital funds such as Polychain Capital, Bain Capital Crypto, Hack VC, and Bankless Ventures.
However, what is particularly notable about Nocturne’s cap chart is the presence of none other than Ethereum founder Vitalik Buterin, who recently expressed his academic interest in the future of privacy on Ethereum.
While Buterin’s presence on Nocturne’s investor list is exciting, the extent of his involvement in the project’s development is unclear, and well-known founders in the crypto world, such as Polygon’s Nailwal and Srinivasan of Coinbase, have sometimes made a habit of launching angel investments in more projects than can be counted.
Will Nocturne have a token?
Tokenomic details, if indeed planned, have not yet been revealed for Nocturne and therefore any discussion of a future token is purely speculation and speculation.
However, we know that investors such as Polychain Capital have already invested in investment rounds focused on tokens rather than stocks.
Additionally, the proposed decentralized nature of Nocturne seems to suggest that a centralized, for-profit entity is not consistent with the decentralized ethos of the project.
The future of the night
As with any early-stage project, Nocturne’s future is far from certain. However, there is growing interest in privacy-preserving technology within the crypto community, and even among Ethereum founders, and so some excitement around the launch of Nocturne version 1 may be justified.
With some $6 million in runway available and the backing of some of the biggest players in the industry, Nocturne could revolutionize the way we use the world’s largest smart contract network.