Hello everyone. If the previous talk was about "why," this time I want to share a story from the perspective of a frontline technical person who has been working hard in the field, about how to turn this idea into reality.

In 2018, we first proposed in our white paper to create a blockchain that is "both private and auditable." The industry’s reaction was basically: you guys are crazy. The reasoning was solid—privacy equals hiding, and compliance requires transparency. How can these two things be done together?

But our team, composed of veterans from cryptography and traditional finance, has that drive to challenge this seemingly irreconcilable contradiction. These six years of effort have essentially been a series of intense technical battles.

**Initial Stage: Laying a solid foundation for privacy**

We didn’t take shortcuts by copying existing consensus mechanisms. Traditional proof-of-stake placed on the privacy side posed big problems—validators’ identities could be exposed easily, making them targets. So we devised our own Segregated Byzantine Agreement consensus, with the core idea of introducing a "blind voting" lottery system.

Simply put: the process of selecting who produces blocks and who verifies transactions is encrypted and randomized. Anyone in the network doesn’t know if their neighbor has been chosen, which protects identities from the source.

**Development Stage: Making contract logic also learn to "shut up"**

Just privacy for transactions isn’t enough; the logic of contract execution also needs to be hidden. We designed the Phoenix transaction model and Piecrust virtual machine to solve this. Developers can now write "confidential smart contracts"—not only are transfer processes encrypted, but the entire contract execution steps and state changes are also in ciphertext. Only authorized participants can see what actually happened.