Crypto project Payy, which operates a privacy-focused wallet alongside a crypto banking card, has just launched a privacy-enabled Ethereum layer 2.
In an announcement via X on Wednesday, Payy said users can now integrate the network into their MetaMask accounts, and that all ERC-20 transfers made on it are automatically made private with “no smart contract changes required.”
Payy said the two core types of users on its network would be institutions and fintech firms looking to bring “flows onchain without fear of analysis and exploitation,” and crypto natives looking to use privacy tools without “juggling multiple wallets.”
“Some of the largest stablecoin players are day 1 launch partners on Payy Network. We’ll be announcing them in the coming weeks,” Payy said.
The network is compatible with any Ethereum Virtual Machine (EVM) wallet, and the project’s website indicates that the layer-2 is primarily geared toward “making stablecoins private,” despite also supporting all ERC-20 tokens.
Following the announcement, Payy CEO Sid Gandhi also shared more details on X, noting that Payy is working to help large traditional finance institutions feel more comfortable moving capital onchain.
“Nearly every bank, fintech, and enterprise is telling us the same thing: They cannot move real capital flows onchain if their financial data is exposed to the world,” he said.
In terms of Payy’s privacy, the layer 2 hosts private ERC-20 pools that users’ transactions are automatically routed through when using wallets like MetaMask. This enables users to move funds from their normal wallets without the outside world seeing where the funds are going.
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When interacting with decentralized finance apps and smart contracts, funds are withdrawn from the private pools to a new address.
Before this, Payy primarily provided its own privacy-focused wallet alongside a crypto banking card, which launched in mid-2025. The project claims to have racked up 100,000 users of its wallet services.
There are already other L2s and protocols offering privacy services on Ethereum, such as Aztec Network and Railgun, which use similar methods to conceal transfer activity.
Meanwhile, there are a host of privacy-focused tokens such as Zcash (ZEC) and Monero (XMR) that exploded in popularity in 2025 amid a crypto privacy sector boom last year.
According to Payy, it aims to provide a point of difference by reducing the hurdles to maintaining privacy, such as managing multiple wallets or switching between multiple protocols.
However, Payy is not the only one working on this. Cointelegraph reported in October that Ethereum developers were working on upgrading wallet privacy as part of the Kohaku roadmap.
The goal of Kohaku is to reduce reliance on centralized parties that track transactions, while also including features such as private sending and receiving.
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