Ethereum considers launching a self-funded privacy pool for 2027 upgrades

Ethereum researchers propose prioritizing two transaction changes for the 2027 Hegotá upgrade

Ethereum researchers propose prioritizing two transaction changes in the 2027 Hegotá upgrade, which will allow the privacy pool to pay network fees without third-party intermediaries.

Summary

Frame Transactions will give wallets more control over transaction verification, execution and fee payment. The FOCIL mechanism will make it more difficult for block builders to rule out eligible privacy transactions. There are still 66 proposals under consideration, and FOCIL is the only feature that has been confirmed for inclusion in the Hegotá upgrade. Ethereum developers plan to advance the Hegotá upgrade in 2027 after the release of the Glamsterdam upgrade in 2026.

Ethereum privacy pool can pay for itself

Framework transactions will introduce a programmable transaction format that will give wallets more control over verification, execution and Gas payments. Wahrstätter described the framework as a "more expressive transaction format" that is a key component of the trading experience in the Ethereum initiative.

Under the proposal, transaction logic will be divided into programmable frameworks rather than relying on Ethereum's current fixed transaction structure. Wallets and applications can leverage this format for Gas sponsorship , alternative signature systems, key rotation, and other forms of account abstraction.

For privacy pools, the fee payment feature eliminates the need for a separate repeater-a repeater used to submit transactions and pay Gas fees. Repeaters can become another link, exposing transaction details, wallet behavior or network information to external services.

"Combined with framework transactions, these features will allow the privacy pool itself to pay for fees, eliminating the need for intermediaries," Wahrstätter said. "Coupled with the support of FOCIL, privacy transactions will also be guaranteed at the protocol level."

Framework transactions will be used with Keyed Nanges and Recent Roots, which are listed as EIP-8272. Key nonce allows accounts to maintain independent sequences of transactions, while recent roots allow transactions to reference recent Ethereum states rather than relying on a single fixed block reference.

This proposal package also includes Transaction Assertions, or EIP-7906. According to Wahrstätter, assertions allow wallets to define conditions that must remain true while transactions are processed, thereby providing users with a way to limit what may happen after signing and submission.

Currently, EIP-8141 is still under consideration and has not yet been officially upgraded into Hegotá. The Ethereum client team is also comparing it with another account abstraction proposal, EIP-8130, before deciding which design should go into the implementation and testing phases.

FOCIL will protect eligible transactions from censorship

FOCIL is currently the only Ethereum improvement proposal that has been confirmed to include the Hegotá upgrade. The design allows a validator committee to publish a list of transactions that block builders should include.

If the builder improperly excludes eligible transactions from inclusion in the list, the bidder can reject the proposed block. Ethereum developers say that as block production becomes more professional and focuses on large builders, the system can protect access to transactions.

Privacy transactions will benefit because users do not have to rely entirely on the wishes of the block builder to include their transactions. FOCIL itself does not make transactions private, but it adds a protocol-level process to resist selective exclusions.

Wahrstätter believes that combining FOCIL with framework transactions, key nonce and near-term roots will provide independent fee payment capabilities and greater inclusion protection for the privacy pool. His proposal represents a priority for researchers, not a final decision for Ethereum's core developers.

Currently, 66 proposals are under discussion for Hegotá upgrades, covering account abstraction, anti-censorship, transaction pricing, status growth, verifier economics and network expansion. This number does not mean that all 66 features will be available, as most have not yet entered the implementation, development network or public test network stage.

"One upgrade cannot become a community or core developer's wish list for what Ethereum should ultimately become," Wahrstätter wrote in an earlier post. Developers need to decide which changes Ethereum should adopt next and which changes will require more time.

U.S. regulatory concerns put cryptocurrency privacy tools into focus

For U.S. users, these proposals concern how Ethereum handles private transactions, rather than changing federal-level rules on money transfers, sanctions, or illegal finance. The United States 'regulatory attitude towards cryptocurrency privacy software has been controversial in Treasury Department actions and criminal cases involving mixed-currency services.

The U.S. Treasury Department lifted economic sanctions on Tornado Cash in March 2025 after reassessing the legal and policy issues raised by applying sanctions to technology-based financial activities. The Ministry of Finance said at the time that it remained concerned about the use of digital assets by North Korean hackers and other illegal actors.

In a separate criminal case, a Manhattan jury found in August 2025 that Tornado Cash co-founder Roman Storm conspired to operate an unlicensed money transfer business. According to reports, the jury failed to reach a unanimous verdict on money laundering and sanctions charges.

The U.S. Department of Justice said Tornado Cash transferred more than $1 billion in criminal proceeds, including funds related to North Korea's Lazarus Group. Storm's defense maintains that the agreement is run through autonomous open source software and its developers have no control over individual transactions.

The privacy pool design proposed by Ethereum differs at the protocol level because Wahrstätter's posts address fee payments and transaction inclusion rather than the legal structure or compliance system of a specific application. Neither EIP-8141 nor EIP-7805 defines how privacy apps will handle U.S. sanctions screenings, money transfer rules, or other compliance requirements.

Hegotá will follow Ethereum's 2026 Glamestead upgrade

Hegotá is planned to launch after Glamestead, an upgrade that Ethereum developers hope to release before the end of 2026. The core of the Glamestead upgrade is the built-in Enshrined Proposer-Builder Separation and Block-Level Access Lists, as well as adjustments to the pricing of Ethereum network resources.

The built-in proposer-builder separation will introduce the division of labor between block proposers and builders into the Ethereum protocol. The block-level access list will display the account and contract data required for the block, allowing clients to prepare data before execution and process some transactions in parallel.

Hegotá 's candidate extends this work into the areas of privacy, censorship resistance, account abstraction and state management. Expansion proposals under review include EIP-8368, which would adjust state creation costs when Ethereum raises the Gas cap above the level used by Glamestead.

Developers are also studying independent access list data, a higher Gas cap of nearly 500 million to 600 million, and optional zero-knowledge Ethereum virtual machine certification on the main web. Each proposal must compete for engineering resources, client support, testing time and space in the 2027 release schedule.

Privacy and anti-quantum computing are also part of Ethereum's multi-year technology plan. Vitalik Buterin's "Lean Ethereum" initiative calls for the introduction of new cryptography, proof-based verification, redesigned storage, and native protocol privacy over the next three to four years.

The executive client team has until September 10 to submit its priority list for Hegotá. Prior to this, developers plan to compare EIP-8141 and EIP-8130 at a breakout meeting on August 25, and plan to make a decision on competing account abstraction designs at an all-core developer executive meeting on August 27.