COTI Explains Why Stealth Addresses Don’t Make You Invisible

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• COTI published a blog post on October 10, 2026 explaining how stealth addresses work on Ethereum, Bitcoin and Monero, and detailing what the technique leaves exposed
• The post notes that a 2023 academic study of the Umbra stealth address tool was able to re-link between roughly 26% and 66% of payments depending on the network, mostly through user behavior
• COTI tied the explainer to its own upcoming Interphase product, which plans to use stealth addresses for cross-chain private transfers sometime between the fourth quarter of 2026 and the first quarter of 2027

COTI, the privacy-focused Layer 2 network, published a blog post titled “Stealth Addresses Explained: How They Work and What They Don’t Hide” on October 10, 2026, walking through the mechanics behind a privacy technique that has become increasingly common across blockchain ecosystems as users and developers look for ways to break the link between a recipient’s public identity and the payments they receive.

The post describes how a recipient publishes a reusable stealth meta-address containing a spending key and a viewing key, letting senders derive a brand-new, one-time address for every payment that only the sender and recipient can tie back to the recipient’s real identity. On Ethereum, this typically follows the ERC-5564 standard, where the sender publishes a short “view tag” alongside each payment so the recipient’s wallet can scan announcements efficiently without checking every single transaction on the chain. Bitcoin’s comparable approach, Silent Payments under BIP-352, skips the on-chain announcement entirely in favor of static addresses, which means wallets must scan more of the blockchain directly to detect incoming funds. Monero goes further still, building one-time addresses into every transaction by default and pairing them with ring signatures and RingCT to hide both the sender and the transaction amount.

Despite the privacy gains, COTI’s post is explicit that stealth addresses have real limits. On transparent chains like Ethereum and Bitcoin, the fact that a transfer happened, the sender’s address, and the payment amount all remain publicly visible, as does the timing of the transaction. The post also flags a more subtle leak: a freshly generated stealth address typically holds no native token to pay gas fees, so topping it up from a main wallet can inadvertently link the two addresses together, undoing much of the privacy benefit the scheme was meant to provide.

To underscore how real this risk is in practice, the post cites a 2023 academic study of Umbra, an Ethereum-based stealth address tool, which found that researchers could re-link somewhere between roughly 26% and 66% of payments back to their likely recipients, depending on the network studied. The leading cause was not a flaw in the cryptography itself but ordinary user behavior, such as withdrawing stealth funds to a previously used address or consolidating several stealth payments into a single destination, patterns that create exactly the kind of address reuse the scheme is designed to avoid.

COTI connected the explainer to its own roadmap, noting that its planned Interphase product is expected to use stealth addresses to support private cross-chain transfers, with a target delivery window between the fourth quarter of 2026 and the first quarter of 2027. The post, published on COTI’s official blog, said Interphase’s roadmap also calls for automatically funding gas on behalf of recipients and building in a privacy check that would warn users before a withdrawal risks linking a stealth address back to their identity, directly addressing the gas-funding leak the post itself describes.