At LumenShade, we're bringing financial discretion to Stellar.

We were inspired by projects like Tornado Cash, 0xbow’s Privacy Pools and Railgun.

Our mission is simple: empower users with financial privacy, while building the foundation for fully compliant, private DeFi on Stellar.

Motivation

Stellar is an incredible platform for fast, low-cost global payments, especially across emerging markets.

But today’s users don’t have strong privacy options.

We believe that privacy is a necessity, not a luxury, and it’s time for Stellar to start offering real options.

Right now, payments on Stellar are fully public.

We strongly believe that mainstream blockchain adoption will come when privacy is integrated by default.

Think about NGOs working in sensitive regions, businesses wanting to protect their payment flows, or just regular individuals who simply don’t want their entire transaction history displayed to the world…

LumenShade can help make this possible.

Our modular components will be reusable for other projects in the ecosystem, fueling further innovation in privacy across the Stellar developer community.

Description

In simple terms, LumenShade lets users deposit Stellar assets (like XLM and USDC) into a shared pool, and withdraw them later without anyone being able to trace the link between the deposit and the withdrawal.

Here's how it works:

• When a user deposits funds into the pool, he receives a unique note (a secret) that proves ownership of that deposit

• Later, when the user wants to withdraw, he generates a zero-knowledge proof showing they own one of the previous deposits, by proving knowledge of the previous “note”

• The smart contract verifies the proof and, if correct, releases the funds to a specified address. There’s now no way to link that withdrawal with any deposit

• The more deposits, the bigger the anonymity set, the more private each user is

Here are some of the key features we're excited to deliver:

• Privacy-preserving deposits and withdrawals, thanks to zero-knowledge proofs

• Intuitive frontend and CLI tools, for a seamless user experience

• An innovative compliance layer featuring:

  • selective disclosure: users can prove the origin of funds when needed

  • admin control on deposits: blacklisting if required

• Modular, reusable smart contracts and circuits, enabling future ZK projects on Stellar

We also take inspiration from Railgun, which has set a high bar for compliant privacy pools with features like “private proof of innocence”. LumenShade is built to move Stellar in that same direction.

Yes

$135.0K

• Technical Success:

  • Fully working privacy pool on mainnet

  • Circuits audited and proven sound

• User Adoption:

  • 1000+ real users

  • Integration into 1+ Stellar wallet

• Community & Compliance:

  • Feedback from Stellar community integrated into v1.0

  • Demonstrate compliance aligned with MiCA: allow users to prove origin of funds

• Partner with Stellar wallet providers to integrate LumenShade

• Highlight real-world use cases (NGOs, private remittances, institutional privacy)

• Educate with blog posts, zk explainers, and workshop sessions

• Run an engaging testnet campaigns: encourage participation and provide hands-on experience with LumenShade

• Work with regulatory experts to refine compliance

• No fees at launch. A small protocol fee may be added later to sustain operations

Our team has a strong track record in zero-knowledge, smart contracts, and full-stack development:

• David (teddav): ZK auditor, working on real-world zero-knowledge use cases. Previously built a stablecoin protocol on Ethereum (peaked at $200M TVL)

  • https://x.com/0xteddav

  • https://github.com/teddav/

  • https://teddav.github.io/

• Oba: Cryptography & ZK expert. Currently building Kakarot, a zkEVM written in Cairo

  • https://x.com/obatirou

  • https://github.com/obatirou

  • https://obatirou.xyz/

• Alex: Full stack developer specialized in web and mobile apps

  • https://github.com/Amanukyan/

We've already started early discussions with Stellar wallet providers to ensure a smooth integration and provide an excellent user experience.

Estimated time: 2 months

Estimated Budget: $60,000

• Implement ZK circuits: ideally in Circom, but we’ll also explore Noir for a more future-proof project

• Integrate Circom (or UltraHonk) verifier in Soroban

• Soroban contracts

• Frontend interface (proof generation, UI for deposits/withdrawals)

• Conduct rigorous internal testing to ensure stability and security.

• Initial compliance feature: opt-in transaction disclosure to third parties

How to verify completion?

• Public repo with zk circuits, Soroban contracts

• Working PoC on devnet:

  • deployable Soroban contracts

  • ability to send money to the pool and withdraw anonymously

• Demo video and frontend walkthrough

Estimated time: 2 months

Estimated Budget: $50,000

• Enhanced compliance tooling:

  • Admin filtering logic (address blacklist)

  • Interfaces for compliance disclosure requests

  • Community discussion around decentralized admin structure

• Deploy fully functional MVP to testnet

• UI/UX polish

• Start Stellar wallet integration(s)

• Developer-oriented documentation (Soroban integration examples)

• Release testing tools to facilitate user interaction with testnet (ex: faucet)

• Enhance test suite: fuzzing and edge-case testing

How to verify completion?

• Public testnet with working UI

• Documentation and codebase published

• Confirmation of testnet usage: at least 10000 testnet deposits

Estimated time: 1 month

Estimated Budget: $25,000

• Launch on Stellar mainnet with public frontend

• Documentation

• Finalize compliance layer features and logic: admin dashboard for managing deposits’ blacklist

• Compliance guide

• UI polish:

  • Hire a designer for branding and UI/UX improvements

  • Design clean and user-friendly interface

• Audit (provided by Stellar):

  • Prepare for audit of contracts and circuits

  • Fix all findings

• Organize trusted setup ceremony (for Circom circuits)

How to verify completion?

• Public launch with open-source code and docs

• Successful trusted setup ceremony

• Live deployment on Mainnet

We are 3 people specialized in cryptography and blockchain development: teddav (https://x.com/0xteddav), oba (https://x.com/obatirou) and alex (not a lot of online presence).