Milestone 2 – June 2026: Scalability, Security, and User Abstraction

4.1 Privacy Phase 1

The first privacy phase introduces selective data confidentiality mechanisms, including partial transaction privacy and reduced metadata exposure. These features address core enterprise needs for confidentiality while preserving auditability.

Privacy Phase 1 focuses on practical confidentiality rather than full anonymity.

Implemented Mechanisms

• Selective encryption of transaction payload fields

• Reduced on-chain exposure of sensitive metadata

• Separation of business logic data from settlement-critical state

Policy-Driven Privacy Controls

Privacy controls are policy-driven, allowing:

• Enterprise-specific confidentiality configurations

• Controlled visibility for auditors and regulators

• Gradual introduction of cryptographic privacy without breaking existing tooling

This phased approach ensures compatibility with compliance frameworks such as financial reporting, audit trails, and lawful disclosure requirements.

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4.2 Native Multisignature Support

KONET integrates native multisignature functionality at the protocol level, rather than relying solely on smart contracts. This delivers:

• Simplified key management

• Lower operational risk

• Enhanced security for institutional asset custody and governance

Key Properties

• Multisig validation occurs during transaction verification, before execution

• Signature thresholds and signer sets are defined at the account level

• Reduced gas costs and attack vectors compared to contract-based multisig wallets

Enabled Use Cases

This enables:

• Institutional-grade custody models

• Governance-controlled treasury accounts

• Secure validator and administrative operations

Native multisig significantly lowers operational complexity and reduces smart contract risk for high-value accounts.

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4.3 Account Abstraction

Account Abstraction decouples user experience from traditional externally owned account (EOA) limitations. On KONET, this enables:

• Flexible authentication and recovery models

• Gas fee abstraction and sponsorship

• Web2-like user experience for Web3 applications

Key Capabilities

• Custom validation logic (multi-factor auth, biometrics, hardware keys)

• Social and institutional recovery mechanisms

• Fee sponsorship and meta-transactions

• Application-specific account logic

System Perspective

From a system perspective:

• Transactions are validated against abstracted account rules

• Gas payment responsibility can be delegated or pooled

• Wallet logic becomes upgradeable without protocol forks

This architecture enables Web2-like user experiences while maintaining blockchain-level security guarantees.

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4.4 ZK Rollup Adoption

ZK Rollups introduce cryptographic validity proofs, enabling faster finality, stronger privacy guarantees, and improved scalability. Milestone 2 marks KONET's transition toward ZK-based execution as a core scalability layer.

ZK Rollups replace fraud-based guarantees with cryptographic validity proofs.

Technical Benefits

• Immediate finality once proofs are verified

• No dispute windows

• Stronger privacy through proof-based state transitions

Integration Design

KONET's ZK Rollup integration is designed to:

• Support multiple proving systems over time

• Allow hardware-accelerated proving

• Integrate privacy and scalability into a unified execution layer

This positions ZK Rollups as the long-term scalability backbone of the network.