Pioneer transaction: Last week, Boerse Stuttgart Group announced that it completed the first confidential delivery-versus-payment (DvP) transactions of tokenized securities on a public blockchain. The settlement was processed through its DLT platform, Seturion, while the transaction itself was executed on Aztec, a privacy-focused layer-2 network built on Ethereum.

Why it matters: Unlike previous tokenized DvP tests, the transaction data, including counterparties, amounts, and execution logic, was not visible on the public chain. Instead, only a cryptographic proof confirming that all settlement conditions were met was recorded on Ethereum.

Inside the transactions: With wholesale CBDC and stablecoin adoption still evolving, Boerse Stuttgart tested two DvP models, one using traditional payment rails for the cash leg and one using onchain cash.

Selective disclosure: In both models, only the buyer and seller were able to see their own balances and transaction details. The public blockchain just recorded encrypted entries and a proof that the rules were followed, while regulators can access additional information if required.

Research phase: As of now, the transactions were executed as a technical proof of concept rather than a live production rollout, aimed at exploring how confidential settlement could function on public infrastructure.

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Industry perspectives: To provide more context, we spoke with the two actors involved and asked another key market participant for their assessment on where onchain privacy stands today.

Samuel Bisig is the Chief Technical Officer at Seturion, the DLT settlement platform of Boerse Stuttgart Group. The platform builds on infrastructure first deployed in Switzerland, where the group’s subsidiary BX Digital operates a FINMA-regulated DLT trading venue using it as its settlement layer. Now applying for an EU DLT Pilot Regime license, Boerse Stuttgart is extending this proven model into the European market.

When evaluating privacy solutions, our focus was on whether they could realistically support securities settlement in a regulated market environment. We looked at permissioned network approaches, which can provide confidentiality but require participants to operate within closed networks and specific governance models. For us, this raised questions around interoperability and how such systems could connect to broader market infrastructure.

While we are evaluating various approaches that add privacy, we especially see added value in “programmable privacy” directly on the protocol level, rather than just on the data level (potentially even adding further centralization vectors like sequencers, security councils, permission committees). The protocol-inherent separation of private and public execution and state in Aztec allows us to keep everything private and confidential by default, while allowing special third parties like a regulator to access the data with auditability.

Looking ahead, scaling this approach will depend on how privacy-preserving networks like Aztec mature in practice. That includes their ability to operate reliably over time, how they scale under load, how they integrate with institutional custody and key management setups, as well as the general development of standardized security token frameworks.

Arnaud Schenk serves as Executive Director of the Aztec Foundation, which oversees the development of the Aztec Network, a privacy-centric Ethereum Layer 2 infrastructure.

Instead of sending transaction details directly to a public blockchain, the transaction logic is executed in a privacy-preserving execution environment, in this case Aztec, where all rules, checks, and conditions are evaluated confidentially before any proof is published. This includes relevant business logic and, where applicable, compliance requirements. The public blockchain only receives a cryptographic proof and never sees the underlying transaction data or how the transaction was executed.

What is recorded on the blockchain is simply a cryptographic proof confirming that the rules were followed correctly. Neither the public network nor the validators verifying the transaction have access to the underlying information: they only check the validity of the proof and update an encrypted state, without visibility into users, amounts, counterparties, or execution logic.

Regulators and other authorized parties can be granted access to the underlying transaction information when legally required, without making that data public. This allows institutions to combine confidentiality for market participants with effective regulatory oversight, while still relying on public blockchain infrastructure for settlement and finality.

Daniel Coheur joined Apex Group as Global Head of Digital Assets following the fund administrator’s acquisition of Tokeny, the Luxembourg-based tokenization platform he co-founded. With its Apex Digital 3.0 platform and its work around the ERC-3643 standard, Apex Group is making a big push into tokenization.

From our perspective working with asset managers and fund issuers, demand for onchain privacy is clearly increasing. There is broad agreement that sensitive investor data, such as personal identity, eligibility documentation, and detailed cap table information, should not appear on public blockchains. In most institutional structures, that information remains offchain with regulated intermediaries.

The open question is transaction-level confidentiality. As tokenized securities move into DvP settlement and collateral use cases, attention shifts to what becomes visible in trading and settlement flows.

Transfer amounts, counterparty exposure, and position movements are commercially sensitive and often balance-sheet relevant. Test transactions like the one executed by Seturion matter because they demonstrate how settlement can evolve without exposing that information.

Disclaimer: The information provided in the Institutional Briefing by Blockstories does not constitute investment advice. Accordingly, we assume no liability for any investment decisions made based on the content presented herein.