Documentation Index
Fetch the complete documentation index at: https://docs.inkwell.finance/llms.txt
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CONFIDENTIAL & PROPRIETARY © 2026 Inkwell Finance, Inc. All Rights Reserved. This document is for informational purposes only and does not constitute legal, tax, or investment advice, nor an offer to sell or a solicitation to buy any security or other financial instrument. Any examples, structures, or flows described here are design intent only and may change.
Pre-alpha vs production. Pages that describe “the operator holds the session-to-ephemeral-key mapping” describe today’s single-operator implementation. Production Dagon will distribute this custody across an Ika 2PC-MPC dWallet network — no single “operator” entity will hold the mapping, and no unilateral disclosure (lawful or otherwise) will be possible without the network agreeing. The two-party composition described here is strengthened, not weakened, by the migration. See Design Philosophy for the full decentralization roadmap.
What a mixer is
A mixer (Tornado Cash, Samourai Whirlpool, Wasabi-style CoinJoin) creates anonymity by pooling many users into a single state and severing the link between deposit and withdrawal. The privacy property is set-based: users hide among N others whose coins look identical after mixing. Consequences:- The deposit-to-withdrawal link is cryptographically severed.
- There is no concept of a “rightful owner” of any particular output after mixing.
- Under compelled process, the operator can produce the pool state but cannot identify a specific user’s outputs.
- Flow-level obfuscation is the product.
What Dagon is
Dagon does not pool and does not sever the deposit↔withdrawal link. Within a session, money in equals money out. The flow of funds is structurally legible on-chain. What’s hidden is the order content during matching — size, side, curves, and crossings — not the movement of capital. Session-level flow transparency is a feature, not an apology. Concrete tests:| Question | Mixer | Dagon |
|---|---|---|
| Can you deposit and withdraw to a different address? | Yes | No — withdrawals return to the depositor’s controlled address |
| Is there a pooled anonymity set? | Yes | No |
| Can an observer link a user’s deposit to their withdrawal? | No (severed) | Yes (preserved by design) |
| Under compelled process to both operator + issuer, can one named user’s activity be resolved? | No — no compliance surface | Yes — this is the compliance path |
| What’s hidden? | Flow of funds | Order content during matching |
Why this matters legally
The positive-claim rebuttal: regulatory liability comes from flow obfuscation. Mixers got designated because their architecture had no natural compliance surface — the operator structurally could not identify any specific user’s activity, so there was no party for a court to turn to. Regulators read that as evasion-by-design. Dagon has a compliance surface: the two-party composition. A court can compel both the operator and the credential issuer, and the response is a specific user’s activity. Every counterparty holds a KYC-backed BBS+ or Coconut credential; Sybil resistance is structural, not reputation-based. That’s the ProtonMail posture, not the Tornado posture: encrypted by default, responsive to lawful process. The specific rules the posture is designed against include Reg ATS, FINRA 4552/5270, MiCA Arts. 76/78, MiFID II, GDPR Art. 22, and FATF Rec 16.What about user privacy, then?
The user is not anonymous in the Tornado sense. The user is identity- protected from the public, from counterparties, and from the operator in normal operation, with recovery gated on the specific two-party composition. In practice:- An on-chain observer watching Solana sees the user’s deposit and (eventually) withdrawal. They cannot see any order, fill, curve, or clearing price.
- A counterparty in the same batch sees neither who the user is nor what was submitted.
- The operator sees an encrypted ciphertext at ingress and a settlement delta at egress. It cannot tell which curve was which.
- The issuer sees KYC data only, never any venue activity.