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L2PS (Layer 2 Privacy Subnet) Framework

L2PS is a privacy-preserving transaction layer that enables encrypted transactions on the Demos Network. Unlike public L1 transactions, L2PS transactions are encrypted client-side and only decrypted by authorized network participants.

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Key Features

Client-Side Encryption

Transactions are encrypted with AES-GCM (32-byte key, 12-byte IV, authentication tag) in your browser before leaving your device.

Batch Rollups

Multiple L2PS transactions are bundled into a single L1 transaction per block.

ZK Proofs

PLONK zero-knowledge proofs verify batch validity without revealing content.

Authenticated History

Only address owners can access their private transaction history via cryptographic signatures.

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How It Works

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Transaction Flow

1

Client Encrypts

Transaction is encrypted with the shared AES-GCM key (32 bytes) and IV (12 bytes) in the browser before transmission.
2

L2PS Node Decrypts

Node receives encrypted blob, decrypts, validates signature and balance.
3

Batch Aggregator

Bundles up to 10 transactions per L1 block with ZK proof.
4

L1 Submission

Single L1 batch transaction submitted to blockchain.

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Privacy Model

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Transaction Lifecycle

Every L2PS transaction progresses through three stages:

Executed

Instant - Local node decrypts, validates against L1 state, reserves balance.

Batched

Per L1 block - Transaction included in batch with ZK proof generated.

Confirmed

Final - L1 block confirmed, transaction is immutable on blockchain.

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Transaction Fee

Each L2PS transaction costs 1 DEM. This creates a deflationary mechanism while ensuring fair access to privacy features.

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Architecture Components

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Network Participation

To participate in an L2PS network, nodes must:
  1. Have the shared AES-GCM key (32 bytes / 64 hex chars) and IV (12 bytes / 24 hex chars)
  2. Be configured with the correct L2PS UID
  3. Store and sync the L2PS mempool with other participants

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Next Steps

Transaction Handling

Learn how L2PS transactions are processed

Quick Start

Set up L2PS from scratch

POC App

Interactive demo app for testing L2PS