What Is a Shielded Transaction?
A shielded transaction is a transaction between two shielded addresses, where the transaction data is encrypted and remains confidential while still being verifiable by network nodes.
Shielded addresses utilize zero-knowledge proofs to encrypt transaction details, including the addresses involved, the transaction amount, and the memo field.
This ensures that this information remains private, except for fund migrations between Sprout and Sapling shielded addresses.
Enhancing Privacy in Shielded Transactions
When sending funds to a shielded address, the sender may or may not include an encrypted memo.
On the other hand, recipients of shielded transactions do not learn the sender’s address from the transaction receipt in their wallet.
They can only see the value sent to their address and any included encrypted memo if the funds are received in shielded addresses.