Payy has launched an Ethereum layer-2 network aimed at ensuring transaction privacy for ERC-20 transfers by default, without the need for new wallets or tokens.

In a recent announcement on X, Payy highlighted that users can easily add this new network as a custom chain within MetaMask, facilitating that all ERC-20 transfers made will pass through privacy pools automatically. This streamlined approach requires no changes to existing smart contracts.

The company identified two primary user types: institutions and fintech firms that want to enhance financial flows on-chain while ensuring limited public visibility of transactions, alongside crypto enthusiasts who prefer using privacy solutions without managing multiple wallets.

While names of its undisclosed launch partners are expected to be revealed in the near future, Payy is making strides to provide the necessary comfort for conventional financial institutions when moving capital into the digital on-chain space.

“Most financial institutions express that they cannot transition significant capital flows into the blockchain if their transactional data is publicly accessible,” Gandhi stated.

The layer-2 solution operates by directing users’ transactions through private ERC-20 pools with wallets like MetaMask, effectively shielding transaction details from being publicly disclosed.

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As interactions occur with decentralized finance applications and smart contracts, funds are withdrawn seamlessly from these private pools to a newly generated address.

Previously, Payy was prominently recognized for offering a privacy-centric wallet and a crypto banking card initiated mid-2025, accumulating nearly 100,000 users since its debut.

There are currently several other layer-2 solutions that also focus on privacy protection within the Ethereum network, including Aztec Network and Railgun.

Furthermore, tokens like Zcash and Monero have experienced a rise in popularity during 2025, amid a burgeoning interest in the privacy sector of cryptocurrency.

Payy aims to differentiate its offering by minimizing the operational burden in utilizing privacy mechanisms, such as reducing the need for multiple wallets or switching between various protocols. On a related note, Ethereum developers are reportedly enhancing wallet privacy through initiatives like the Kohaku roadmap, which strives to diminish reliance on centralized entities that monitor transactions.