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Shielded vs Transparent

Namada offers two ways to transact: transparent (public) and shielded (private). Understanding the difference is key to using Namada effectively.

Quick Comparison​

AspectTransparentShielded
Address prefixtnam...znam...
VisibilityPublic on explorerHidden
PrivacyNoneFull
Transaction speed~6 seconds~6 seconds
FeesLowerSlightly higher
RewardsNoneShielded rewards
Best forPublic payments, exchangesPersonal, business

Transparent Transactions​

Transparent transactions work like most blockchains:

Alice (tnam1abc...) → 100 NAM → Bob (tnam1xyz...)

What's Visible​

When you use transparent addresses, anyone can see:

  • ✅ Sender address
  • ✅ Receiver address
  • ✅ Amount transferred
  • ✅ Time of transaction
  • ✅ Transaction history
  • ✅ Current balance

When to Use Transparent​

  • 💱 Withdrawing from exchanges - Exchanges require transparent addresses
  • 🧾 Public payments - When you want a record
  • 🔍 Proving transactions - For tax or legal purposes
  • 💸 Lower fees - Slightly cheaper transactions

Shielded Transactions​

Shielded transactions use Namada's privacy technology:

Alice (znam1abc...) → ??? NAM → ??? (znam1???...)

What's Hidden​

With shielded transactions:

  • ❌ Sender is hidden
  • ❌ Receiver is hidden
  • ❌ Amount is hidden
  • ❌ Transaction links are broken
  • ❌ Balance is private

Only the sender and receiver know the details.

When to Use Shielded​

  • 🛡️ Personal transactions - Keep your finances private
  • 💼 Business payments - Protect commercial information
  • 🎁 Donations - Give privately
  • 💰 Savings - Hide your holdings
  • 🏆 Earning rewards - Get shielded rewards

The Four Transaction Types​

1. Transparent to Transparent​

tnam → tnam

Standard public transfer. Everyone can see everything.

2. Transparent to Shielded (Shield)​

tnam → znam

Moving assets into privacy. The "shielding" transaction is visible, but once in the shielded pool, the assets become private.

3. Shielded to Shielded​

znam → znam

Fully private transfer. No public record of the transaction.

4. Shielded to Transparent (Unshield)​

znam → tnam

Moving assets back to public. The unshielding is visible, but the source in the shielded pool remains hidden.

Visual Flow​

                    TRANSPARENT WORLD
    ┌──────────────────────────────────────────┐
    │  tnam1alice...  ───────► tnam1bob...     │
    │       │                       ▲          │
    │       │ Shield           Unshield        │
    │       ▼                       │          │
    └──────────────────────────────────────────┘
                    SHIELDED POOL
    ╔══════════════════════════════════════════╗
    ║  znam1alice... ────?────► znam1bob...    ║
    ║         All details hidden               ║
    ╚══════════════════════════════════════════╝

Privacy Considerations​

Timing Analysis​

Even with shielding, be aware of timing:

aviso

If you shield 1000 NAM and immediately unshield 1000 NAM to a new address, the connection might be guessed. Wait between operations and use common amounts.

Amount Correlation​

Using unique amounts can reduce privacy:

Less PrivateMore Private
1234.56789 NAM1000 NAM
777 NAM500 NAM
Exact salary amountRound numbers

Best Practices​

  1. Keep assets shielded long-term - Time in the pool increases privacy
  2. Use common amounts - Round numbers are harder to trace
  3. Don't shield/unshield immediately - Add time between operations
  4. Batch transactions - Combine multiple operations

For more tips, see Privacy Best Practices.

Fee Differences​

Shielded transactions require more computation:

Transaction TypeApproximate Fee
Transparent → Transparent~0.001 NAM
Transparent → Shielded~0.01 NAM
Shielded → Shielded~0.01 NAM
Shielded → Transparent~0.01 NAM

Fees vary based on network conditions

Shielded Rewards​

One major benefit of shielded transactions: rewards!

Assets in the shielded pool earn rewards automatically:

  • No staking required
  • Proportional to amount and time
  • Paid in NAM
  • Incentivizes privacy for everyone

Learn more about rewards in Understanding Staking.

FAQ​

Can I see my shielded balance?​

Yes! Your wallet shows your shielded balance. Only you can see it.

Can I prove a shielded transaction?​

Yes, you can generate viewing keys to prove specific transactions if needed.

Which should I use by default?​

Shielded! Unless you have a specific reason for transparency, shielded provides better privacy and earns rewards.

Next Steps​