Mysten Labs has introduced Tessera, a business-to-business settlement prototype that hides payment amounts while preserving controlled access for counterparties, regulators, and auditors.
Summary
- Tessera allows KYC-approved businesses to settle invoices using a confidential stablecoin.
- Payment amounts remain encrypted, while counterparties can view the transactions involving them.
- Seal MPC grants scoped, temporary access to regulators, tax authorities, and dispute arbiters.
- The prototype supports one-time transfers, recurring payments and disputed-payment arbitration.
Tessera brings private B2B settlement to Sui
In an Aug. 10 X thread, Sui presented Tessera as a closed settlement network for businesses. Approved members can settle invoices using a confidential stablecoin without publishing the value of each transaction onchain.
The blockchain continues to show who paid whom and when the payment occurred. However, the amount appears encrypted to outside observers.
“Institutions won’t settle on rails where competitors can see pricing and volume,” Sui said.
A company can see the amount attached to its own transactions, while a competitor viewing the same activity cannot. This design aims to prevent public blockchains from exposing supplier pricing, trading volumes, treasury movements, and other commercially sensitive information.
Membership is gated through know-your-customer checks. Network operators can onboard and fund members, freeze individual accounts, or pause the settlement network when necessary.
Tessera supports one-time transfers and recurring payment channels. If a transaction enters dispute, the network can temporarily give an arbiter access to the relevant payment.
Seal MPC controls who can view payment amounts
Tessera combines Sui’s confidential-transfer technology with Seal, Mysten’s system for encrypted data and programmable onchain access.
Seal uses threshold encryption to distribute control of decryption keys across multiple parties. Its policies can determine who receives access, what information they can view, and how long that permission remains valid.
Under the Tessera demonstration, a prudential regulator could receive visibility across the network. A tax authority could be limited to records involving one member, while an arbitrator could view only a disputed transaction and only while the case remains open.
These mandates are scoped, time-limited, and revocable. None of the authorized viewers can move the underlying money, according to Sui.
The prototype expands on confidential transfers opened for public testing in June. That system encrypts token balances and transferred amounts while leaving addresses, token types, and timestamps visible.
Sui’s confidential transfers use Twisted ElGamal encryption and zero-knowledge proofs to confirm that payments are valid without revealing their value. The network can therefore prevent overdrafts or unauthorized token creation while keeping amounts private.
Blockchains compete for institutional privacy
Public visibility has become a major obstacle for companies considering blockchain settlement. Businesses may not want competitors to monitor their payroll, supplier terms, trading positions, or treasury activity.
Other networks are addressing the same problem. XRP Ledger validators are considering confidential transfers aimed at a tokenized-asset market worth more than $530 million.
Circle has also introduced Arc Privacy for confidential institutional smart contracts. Like Tessera, Arc’s model seeks to hide sensitive financial activity while preserving access for audits and compliance reviews.
Tessera differs from anonymity-focused privacy coins because it does not conceal every part of a payment. Identified participants and authorized oversight remain central to its design.
For U.S. institutions, those controls could support internal compliance and reporting processes, but the announcement did not identify a stablecoin issuer, regulatory approval, or commercial launch jurisdiction.
SUI shows no clear reaction to prototype
SUI traded around $0.69 following the announcement, within a 24-hour range of approximately $0.684 to $0.704, according to CoinGecko. The token showed no clear price move tied specifically to Tessera.
Mysten has described Tessera as a prototype rather than a production network. Sui did not provide a public launch date, participating companies, or deployment schedule.
The next step will be determining whether the model can move beyond a controlled demonstration and support regulated businesses with different privacy, reporting, and dispute-resolution requirements.
