Aztec Architecture Explained: Where Zero-Knowledge Meets Smart Contracts

Understanding Privacy-First Smart Contracts on Ethereum

Ethereum is transparent by default.
Anyone can see your balance, transactions, and smart contract interactions.

Aztec changes that.

Aztec is a privacy-first Layer 2 network built on Ethereum that allows users to send transactions and execute smart contracts privately, while still inheriting Ethereum’s security.

Instead of publishing transaction details on-chain, Aztec uses zero-knowledge proofs to prove that transactions are valid without revealing any private information.

Why do we even need Aztec?

On Ethereum today, your wallet balance is public, your transaction history is public and all your DeFi activity is public. This is great for transparency, but terrible for privacy.

Aztec introduces confidentiality for:

• Transfers

• Smart contract calls

• Application logic

without sacrificing decentralization or security.

TL;DR: Aztec is a private execution layer that securely settles on Ethereum.

High-Level Architecture:

Aztec follows a rollup architecture with private execution.

There are four main layers:

1) User Wallet (Aztec Client)

This is the interface users interact with

• It creates private transactions

• Generates zero-knowledge proofs locally

• Signs transactions

• Encrypts private data

This can be a browser wallet, a mobile wallet, or an SDK integrated into an app

2) Private Execution Layer (Aztec VM + Noir)

Aztec introduces a private virtual machine that runs private smart contracts written in Noir. Execution happens off-chain, but is later proven on-chain

This layer manages:

• Private balances

• Private contract state

• Notes (private assets)

• Encrypted commitments

3) Sequencer Network

Sequencers act as block producers for Aztec. They are responsible for ordering and finalizing Aztec transactions.

• It receives user transactions

• Verify proofs and signatures

• Execute private contracts

• Build rollup blocks

• Generate rollup proofs

• Submit blocks to Ethereum
  

4) Ethereum Settlement Layer

Ethereum is the final judge that never sees private data. It only verifies cryptographic proofs.

• Verifies rollup proofs

• Stores state roots

• Guarantees data availability

• Enforces correctness
  

Actors & Nodes in the Aztec Network

Aztec is powered by a network of specialized nodes that together ensure privacy, correctness, and decentralization.

Each actor has a distinct responsibility in processing transactions, maintaining state, and proving rollup integrity.

1) Full Nodes: It allow users and applications to connect directly to the Aztec network. It ensure that users do not need to trust any third party to interact with Aztec. They provide censorship resistance and independent verification.

• They maintain a full copy of Aztec’s state

• Track private commitments and nullifiers

• Serve data to wallets and apps

• Relay transactions to sequence
  
  

2) Sequencer Nodes: They are responsible for producing Aztec blocks. They are selected via a proof-of-stake mechanism and act as block producers for the Aztec network. They are the backbone of Aztec’s execution layer.

• They receive private transactions from users

• Verify zero-knowledge proofs

• Execute private smart contracts

• Order transactions

• Build rollup blocks

• Submit batches to Ethereum
  
  

3) Provers: They generate the cryptographic proofs that guarantee correctness. Ethereum verifies these proofs before accepting a new Aztec state root. This ensures that even though execution is private and off-chain, correctness is enforced on-chain.

• They take executed transactions from sequencers

• Generate zero-knowledge rollup proofs

• Prove that all private state transitions were valid

• Produce the final proof submitted to Ethereum
  

Aztec’s Private Data Model

Aztec does not use account balances. Instead, it uses a UTXO-like model to ensure double-spending is impossible while ownership is private and state is verifiable. It has:

• Notes: Notes represent private assets. A note is like a secret coin.

• Nullifiers: When a note is spent, a nullifier is published to mark it as spent.

• Commitments: Notes are encrypted and committed to a Merkle tree.

Who Signs What?

User (Alice) Signs:

• Transaction intent

• Note spending authorization

• Contract call

This proves user consent.

Sequencer Signs:

• Rollup block

• Batch submission

This proves block authenticity.

Ethereum Verifies:

• Rollup proof

• State transition

Ethereum does not sign; it verifies

To summarize, Aztec is a privacy-preserving rollup where users execute smart contracts privately, generate zero-knowledge proofs locally, and rely on a sequencer network to batch and settle encrypted state transitions on Ethereum. It combines Zero-knowledge cryptography, Private execution, and rollup scalability with Ethereum security to deliver programmable privacy.

Thanks for reading :))