StarkWare Promises Privacy Layer for Trading on Polymarket

Digital asset firm StarkWare has launched a service that supports privacy for Polymarket trades

Because public blockchains like Polygon let anyone view transactions, traders can trace trades back to individuals, though it takes effort. Zcash says it is eliminating this risk while providing a compliant service.

The product “OffMarket” is a third-party wrapper that routes trades via a shared pool, effectively mixing transactions. Observers can only see aggregated activity, so traders and their strategies remain cloaked from public viewing. The service uses zero-knowledge cryptography to hide activities.

On the compliance side, regulators can access data through an independent compliance firm, Financial Privacy, Inc. StarkWare says it cannot access user activity and that FPI responds only to verified legal requests limited to the scope of a warrant.

Eli Ben-Sasson, StarkWare’s CEO, co-inventor of STARKs and a founding scientist of Zcash, says most users don’t understand how traceable their trades are.

“Millions of people back their hunches on elections, football, films, pop culture, and company results with Polymarket. But few realize that their “anonymous” trades can, with some effort and ingenuity, be traced back to them by anyone looking at the Polygon blockchain, which is publicly visible to all by design,” says Ben-Sasson. The public visibility has the effect that has gone almost unnoticed: any trader with a good position is broadcasting it to their rivals in real time.”

He notes that Polymarket saw $12.9 billion in trading in July. Every trade is publicly viewable.

“On Polymarket, splitting an order across accounts is not privacy — it is a puzzle, and someone will solve it,” says Ben-Sasson. He says it is like “trading in a fishbowl.”

Offering a privacy service for Polymarket raises the question of whether StarkWare will soon offer similar services for other marketplaces.