Enigma is a crypto platform that’s trying to solve the problem of privacy on the blockchain. Using an off-chain network layer, Enigma gives blockchains access to much-needed storage, privacy, and scalability. Additionally, it employs what it dubs secret contracts, a brand of smart contract that gives users an element of privacy that’s not intrinsic to current blockchain protocols.

How it Works

Enigma functions by taking data from the blockchain and, when appropriate, storing it in its off-chain network. As with other current blockchains, data on this blockchain is public, while the off-chain network is responsible for keeping data private.

“Code is executed both on the blockchain (public parts) and on Enigma (private or computationally intensive parts),” the Enigma whitepaper states. This gives Enigma the ability to store data privately while also providing public proof that a transaction was executed on the blockchain. Thus, “Enigma’s execution ensures both privacy and correctness, whereas a blockchain alone can only ensure the latter.”

Private (or secret) contracts are integral to this structure. These are like Ethereum’s smart contracts, except that their focus is, obviously, privacy. With Enigma’s secret contracts scripting language, developers will be able to build dApps for privacy functions. If, for example, a company wanted to issue a quarterly report on employee salaries, it could use Enigma to manage the individual salaries in secrecy while making the median salary public. Each employee could submit his or her salary to the private contract to be factored into the final tally, but only they would be able to see it. When the report was done, they’d then be able to see how they stacked up against their coworkers, as the report would only tally the company’s aggregate and median salaries, not each individual salary.

The Enigma Trifecta

Seeing as Enigma is an off-chain network that complements blockchain networks, it offers a few key benefits:

Storage: Enigma uses a decentralized, off-chain distributed hash-table (DHT) to store references to data without revealing said data. This off-chain storage can be used for general database purposes with information that lies outside the realm of financial transactions, something current blockchains don’t take aim at.

Privacy: We’ve already gone over this, but it’s important to ingrain this use case in your head, as it’s Enigma’s M.O. The off-chain network is managed via private/secret contracts to keep data secure and invisible to those not in control of its private keys. Additionally, “[data]is split between different nodes, and they compute functions together without leaking information to other nodes. Specifically, no single party ever has access to data in its entirety; instead, every party has a meaningless (i.e., seemingly random) piece of it.”

Scalability: By loading computations and data off-chain, Enigma has the potential to provide scaling solutions to the blockchain in the future in addition to its privacy functions.

Enigma Moving Forward

The Enigma team is made up of MIT grads/media lab members, and they’ve been working diligently to ensure Enigma’s success. In the future, they see a plethora of applications and use cases for their project, “including finance, health, identity, and credit.” Their primary focus for now, though, is refining Catalyst, Enigma’s flagship dApp. Catalyst makes use of Enigma’s data marketplace and allows its users to build strategies and tools to improve their crypto-asset investments and research. You can access Catalyst today and begin using its services, and if it’s any indication of the project’s trajectory, it paints a bright future for the versatility of Enigma’s platform.