Starknet Launches Privacy-Focused Bitcoin Asset strkBTC

Starknet, an Ethereum layer-2 network, has launched strkBTC, a Bitcoin-based asset designed to support private balance management and anonymous transfers.

The Block reported on May 12 that StarkWare, the developer of Starknet, officially unveiled strkBTC, a wrapped Bitcoin asset built using zero-knowledge, or ZK, cryptography.

strkBTC does not operate directly on the Bitcoin mainchain. Instead, it is a Bitcoin wrapper asset issued on Starknet. It is designed to let users manage balances privately and make anonymity-based transfers.

Starknet described the asset as privacy infrastructure built with regulatory compliance in mind.

Demand for privacy protections is rising as the risk of tracing increases through the combination of public blockchain data and artificial intelligence, according to The Block.

The report said security firm CertiK identified 34 related attack cases worldwide from the start of 2026 through early May, up about 41% from a year earlier. Some AI tools can connect public wallet addresses with real-world identities with accuracy of as much as 90%.

"Privacy is no longer just an ideal," Damien Chen, vice president of growth at the Starknet Foundation, said. With criminals monitoring public ledgers and using AI to track wallets, it has become "an essential right and a matter of safety," he added.

strkBTC also includes features aimed at meeting legal requirements such as audits and tax filings.

The project said its Viewing Key function allows users to disclose limited data to tax authorities or auditors when necessary. Users can also use the key to disclose their own transactions directly.

Starknet plans to expand strkBTC use cases into private lending, anonymous trading and yield-generating decentralized finance services.