Crypto project Payy, which operates a privacy-focused wallet alongside a crypto banking card, has launched an Ethereum layer-2 network designed to support private ERC-20 transfers.
In an announcement via X on Wednesday, Payy said users can add the network as a custom chain in MetaMask and that ERC-20 transfers made on it are routed through privacy pools by default with “no smart contract changes required.”
Payy said the two core user types on its network would be institutions and fintech firms seeking to bring financial flows onchain while limiting public transaction traceability and crypto natives seeking to use privacy tools without “juggling multiple wallets.”
Payy said it has signed undisclosed launch partners among stablecoin issuers, which it plans to name in the coming weeks.
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 enabling private stablecoin transfers on its network, 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.
Payy explained that 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 publicly exposing transaction counterparties on the Payy Network.
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When interacting with decentralized finance apps and smart contracts, funds are withdrawn from the private pools to a new address.
Previously, Payy primarily offered its own privacy-focused wallet and a crypto banking card, which launched in mid-2025. The project claims to have reached roughly 100,000 users since then.
There are already other L2s and protocols offering privacy services on Ethereum, such as Aztec Network and Railgun.
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 operational complexity of using privacy tools, such as managing multiple wallets or switching between 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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