Epsilon: Smart Contract-based EHT Framework for Elliptic Curve Homomorphic Encryption in Transaction Confidentiality Implementation

Abstract

Modern digital financial systems continuously face the fundamental trilemma of transaction confidentiality, computational efficiency, and cryptographic security. While existing blockchain technologies have made significant progress in security and decentralization, they are limited in ensuring confidentiality of financial information due to their public distributed ledger structure. To overcome these limitations, we present Epsilon, an innovative protocol that fundamentally addresses this complexity by directly combining Elliptic Curve-based Partially Homomorphic Encryption with parallel processing architectures. This paper introduces the Cryptora Protocol, a complete end-to-end operational framework that implements a two-tiered architecture where transaction processing is performed off-chain in a peer-to-peer manner, with results recorded on smart contract-based on-chain distributed ledgers. Our experimental results demonstrate that Epsilon achieves 500,000 TPS with end-to-end latency of 50-100ms while maintaining strong cryptographic guarantees including semantic security, unlinkability, and double-spending resistance.