How Enclave Markets is Building a Privacy-First, Fully Encrypted Crypto Exchange

Welcome to Behind the Startup, HackerNoon’s series uncovering the real stories behind cutting-edge blockchain projects. Today, we dive into privacy-preserving infrastructure and the future of encrypted, trustless markets with Phil Wirtjes, CEO of Enclave Global. From his early career in health tech to leading a fully encrypted exchange built to tackle front-running, slippage, and permissioned trading—Phil offers a transparent look into how EnclaveX is reshaping digital asset markets. Let’s get right into it.

Ishan Pandey: Phil, great to have you here. Before we jump into Enclave Markets, could you walk us through your own journey — from early-stage startups to becoming the CEO of a privacy-first exchange?

\ Phil Wirtjes: I actually have a bit of an unorthodox path to working in crypto since I spent the early part of my career working for health tech companies. I had been a participant in crypto markets since 2016 or so and had started to do some independent work on the side of my desk but it wasn’t until I met the team at Ava Labs in 2020 that I decided to jump full-time into the industry.

Ishan Pandey: What’s the story behind the creation of Enclave Markets? Was there a specific event or problem that triggered the decision to build a fully encrypted exchange?

\ Phil Wirtjes: Unfortunately, even though I was trading crypto since 2016, I had NO idea what I was doing and fell victim to all of the classic mistakes that plagues rookie traders. No risk management, no understanding of slippage / liquidity and a fondness for getting unknowingly liquidated.

\ In 2020, when everything was shut down I started to learn more about payment for order flow and when trading started to move more on chain, MEV began to get hot as a discussion topic and we thought that there had to be a better way to create an exchange for traders like me, which led to Enclave.

Ishan Pandey: Can you help us unpack the phrase “fully encrypted exchange”? Beyond marketing, what makes this architecture distinct from standard decentralized or centralized exchanges?

\ Phil Wirtjes: The fully encrypted exchange really is centered around the use of a Secure Enclave as the lynchpin of our architecture. The master secret to the Enclave is broken into pieces and shared with trusted third parties (we call them “Attestors”) which allows for distributed control amongst the Attestors. This prevents us, the central operators, from being able to take critical unilateral action (such as accessing user funds a la FTX) and cryptographically protect our users from malfeasance.

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Ishan Pandey: With EnclaveX, you're transitioning from a permissioned model to a permissionless one. What risks or trade-offs did you need to manage to make that shift possible?

\ Phil Wirtjes: There are both permissioned and permissionless models of the FEX model we developed at Enclave. There are different use cases and target audiences for each model, and we believe both models will continue to exist in crypto more broadly.

Ishan Pandey: Many protocols claim “decentralization” but rely on single points of custody or governance. How does Enclave’s decentralized custody model compare?

\ Phil Wirtjes: Enclave leverages a decentralized network of third party "Attestors" that collectively secure the encrypted environment where the code for the exchange lives along with wallets for users. This is similar to how many L2s use a group of nodes or validators to secure their protocol that settles to a larger chain.

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Ishan Pandey: What metrics or milestones do you use internally to define product-market fit in a sector that’s still largely experimental?

\ Phil Wirtjes: There are a bunch of ways to define PMF but we try to keep it simple by tracking new deposits, Daily Active Users, Monthly Active Users and things like Open Interest and Volume traded over certain timeframes (24h, 1 week, 1 month). As long as the trendline is moving up and to the right, you are moving towards PMF.

\ At the end of the day, building a profitable company is the goal so those metrics are the leading indicators to positive margins.

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Ishan Pandey: Looking 12 months ahead, what would success look like for Enclave Markets? What would surprise us most about where you’re going next?

\ Phil Wirtjes: I’m not sure it will come as a surprise, but we feel really good about our roadmap towards building a custom made hedge fund for each of our users to put in their pocket. What do I mean?

\ The amount of returns generated by systematic trading firms across multiple asset classes is crazy and is usually gatekept from individual users due to capital constraints OR general knowledge. Through our Alpha Strategies, we are changing this.

\ Soon every user will be able to select their risk profile (aggressive, neutral, passive) and will be recommended trading strategies that are operated by professional trading firms on Enclave. All the user needs to do is deposit their stables (as low as $10 USDC / USDT) and our Strats will trade perpetual contracts across native crypto assets, tokenized real world assets and more… allowing the user to maximize profits on the platform. Inbound interest on these strats has been quite encouraging so we are looking forward to continually shipping over the next 6-12 months.

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:::tip Vested Interest Disclosure: This author is an independent contributor publishing via our business blogging program. HackerNoon has reviewed the report for quality, but the claims herein belong to the author. #DYO

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