GuShiio.com In the era of Web3, TEE (Trusted Execution Environment) is becoming a key cornerstone of data security and private computing. From MEV protection to AI computing, from decentralized finance to DePIN ecosystems, TEE is building a safer and more efficient cryptographic world. This report will take you on an in-depth look at this cutting-edge technology and reveal how it is reshaping the future of Web3.
Chapter 1: The rise of TEE-why is it the core puzzle of the Web3 era?
1.1 What is TEE?
Trusted Execution Environment (TEE) is a hardware-based secure execution environment that ensures that data is not tampered with, stolen or compromised during computing. In modern computing architectures, TEE provides additional security for sensitive data and calculations by creating an isolated area independent of the operating system (OS) and applications.
- Core features of TEE
Isolation: TEE runs in a protected area of the CPU, isolated from the operating system, other applications, and external attackers. Even if hackers break the main operating system, the data and code inside the TEE remain safe.
Integrity: TEE ensures that code and data are not tampered with during execution.
Through Remote Attestation, TEE can externally verify that it is executing trusted code.
Confidentiality: TEE internal data will not be accessed externally and cannot be read even by device manufacturers or cloud providers. Use a Sealed Storage mechanism to ensure that sensitive data remains safe after the device is powered off.
1.2 Why does Web3 need TEE?
In the Web3 ecosystem, private computing, secure execution, and censorship resistance are core requirements, and TEE provides just this key capability. Currently, blockchain and decentralized applications (DApps) face the following problems:
1.2.1 Privacy issues on blockchain
Traditional blockchains (such as Bitcoin and Ethereum) are completely transparent, and all transaction and smart contract data can be viewed by anyone. This raises the following questions:
User privacy leaks: In scenarios such as DeFi transactions, NFT purchases, and social applications, users ‘financial flows and identities may be tracked.
Enterprise data breach: Companies want to take advantage of blockchain technology, but sensitive data (such as trade secrets, medical records) cannot be stored on the public chain.
TEE solution: Through the TEE+ smart contract combination, developers can build private computing contracts. Only authorized users can access the calculation results, while the original data is hidden. Secret Network (a TEE-based privacy smart contract platform) has implemented this model, allowing developers to create DApps that protect user privacy.
1.2.2 MEV (Miner Extractable Value) Problem
MEV (Miner Extractable Value) refers to miners or block producers using the transparency of transaction information to arbitrate when packaging transactions. For example: Front-running: Miners or robots submit transactions in advance before users trade in order to make profits. Sandwich Attack: An attacker inserts his own transactions before and after a user’s transactions to manipulate prices to profit.
TEE solution: With TEE, transactions can be sorted in a private environment, ensuring that miners cannot see transaction details in advance.
Flashbots is exploring TEE+ Fair Sequencing solutions to reduce the impact of MEV on DeFi.
1.2.3 Web3 computing performance bottleneck
The computing power of public chains is limited, and on-chain computing is expensive and inefficient. For example: Ethereum Gas fees are high, and smart contracts with complex calculations are extremely expensive to run. Blockchain cannot efficiently support computing tasks such as AI computing, image processing, and complex financial modeling.
TEE solution: TEE can serve as a core component of a decentralized computing network, allowing smart contracts to outsource computing tasks to a trusted environment and return trusted computing results.
Representative project: iExec (providing a TEE-based decentralized cloud computing platform).
1.2.4 Trust issues in DePIN (decentralized physical infrastructure)
DePIN (Decentralized Physical Infrastructure Networks) is a new trend in the Web3 field, such as Helium (decentralized 5G network), Filecoin (decentralized storage), Render Network (decentralized rendering)
DePIN relies on a de-trusted computing and verification mechanism, and TEE can be used to ensure the credibility of data and computing tasks. For example, a data processing device can perform calculation tasks within the TEE to ensure that the calculation results have not been tampered with. TEE combines remote attestation technology to provide trusted calculation results to the blockchain and solve fraud problems in the DePIN ecosystem.
1.3 TEE versus other private computing technologies (ZKP, MPC, FHE)
Currently, privacy computing technologies in the field of Web3 mainly include:
TEE (Trusted Execution Environment)
Advantages: Efficient, low latency, suitable for high-throughput computing tasks such as MEV protection, AI computing, etc.
Disadvantages: Reliance on specific hardware and security vulnerabilities (such as SGX attacks).
ZKP (zero-knowledge proof)
Advantages: Mathematically prove the correctness of the data without trusting a third party.
Disadvantages: High computing costs and not suitable for large-scale computing.
MPC (Multiparty Computing)
Advantages: No need to rely on a single trusted hardware, suitable for decentralized governance and privacy payments.
Disadvantages: Low computing performance and limited scalability.
FHE (Fully Homomorphic Encryption)
Advantage: Calculations can be performed directly in an encrypted state, suitable for the most extreme privacy needs.
Disadvantages: Computing costs are extremely high and it is currently difficult to commercialize.
Chapter 2: Technical Insider of TEE–In-depth Analysis of the Core Architecture of Trusted Computing
Trusted Execution Environment (TEE) is a hardware-based secure computing technology that aims to provide an isolated execution environment that ensures the confidentiality, integrity, and verifiability of data. With the rapid development of blockchain, artificial intelligence and cloud computing, TEE has become an important part of the Web3 security architecture. This chapter will discuss in depth the core technical principles, mainstream implementation solutions and applications in data security of TEE.
2.1 Fundamentals of TEE
2.1.1 Working mechanism of TEE
TEE uses hardware support to create a protected isolation area inside the CPU to ensure that code and data are not accessed or tampered with by the outside during execution. It usually consists of the following key components:
Secure Memory: TEE uses a dedicated encrypted memory area (Enclave or Secure World) inside the CPU, where external programs cannot access or modify data.
Isolated Execution: The code running within the TEE is independent of the main operating system (OS). Even if the OS is attacked, TEE still ensures data security.
Sealed Storage: Data can be encrypted using a key and stored in an unsecured environment. Only TEE can decrypt the data.
Remote Attestation: Allows remote users to verify that the TEE is running trusted code to ensure that the calculation results have not been tampered with.
2.1.2 The security model of TEE
TEE’s security model relies on the Minimal Trusted Computing Base (TCB) assumption, namely:
Trust only the TEE itself, not the main operating system, drivers, or other external components.
Use encryption technology and hardware protection to prevent software and physical attacks.
2.2 Comparison of three mainstream TEE technologies: Intel SGX, AMD SEV, ARM TrustZone
Currently, mainstream TEE solutions are mainly provided by Intel, AMD and ARM.
2.2.1 Intel SGX（Software Guard Extensions）
TEE technology introduced by Intel first appeared in Skylake and subsequent CPUs. Provide a secure computing environment through Enclave (Cryptographic Quarantine Zone), suitable for cloud computing, blockchain privacy contracts, etc.
Core characteristics. Enclave-based memory isolation: Applications can create protected Enclaves to store sensitive code and data.
Hardware-level memory encryption: Data in Enclave is always encrypted outside the CPU and cannot be read even if memory is dumped.
Remote attestation: Allows remote verification that Enclave is running untampered code.
Limitations: Enclave memory limit (early only 128MB, expandable to 1GB+). Vulnerable to side channel attacks (such as L1TF, Plundervolt, SGAxe). Complex development environment (requires the use of SGX SDK to write specialized applications).
2.2.2 AMD SEV（Secure Encrypted Virtualization）
TEE technology introduced by AMD is mainly used for secure computing in virtualized environments. Suitable for cloud computing scenarios and provides virtual machine (VM) level encryption protection.
- core features
Full memory encryption: Use the CPU internal key to encrypt the entire VM’s memory.
Multi-VM isolation: Each VM has an independent key, preventing different VMs on the same physical machine from accessing each other’s data.
SEV-SNP (latest version) supports remote certification to verify the integrity of VM code.
Limitations: Only suitable for virtualized environments and not suitable for non-VM applications. The performance overhead is high, and encryption and decryption increase the computing burden.
2.2.3 ARM TrustZone
The TEE solution provided by ARM is widely used in mobile devices, IoT devices and smart contract hardware wallets.
Secure World and Normal World are provided through CPU-level partitioning.
- core features
Lightweight architecture: Does not rely on complex virtualization technology and is suitable for low-power devices.
Full system-level TEE support: Supports secure applications such as encrypted storage, DRM, and financial payments.
Hardware-based isolation is different from SGX’s Enclave mechanism.
Limitations: The security level is lower than SGX and SEV because Secure World relies on device manufacturer implementations. Development is limited, and some functions can only be opened by device manufacturers, making it difficult for third-party developers to access the full TEE API.
2.3 RISC-V Keystone: Future hopes for open source TEE
2.3.1 Why do I need open source TEE?
Intel SGX and AMD SEV are proprietary technologies and subject to vendor restrictions. RISC-V is an open source instruction set architecture (ISA) that allows developers to create customized TEE solutions to avoid security issues with closed-source hardware.
2.3.2 Key features of Keystone TEE
Based on RISC-V architecture, it is completely open source. Supporting flexible security policies, developers can define their own TEE mechanisms. It is suitable for decentralized computing and the Web3 ecosystem, and can be combined with blockchain for trusted computing.
2.3.3 Keystone’s future development
May become a critical infrastructure for Web3 computing security, avoiding reliance on Intel or AMD. The community promotes stronger security mechanisms to reduce the risk of side channel attacks.
2.4 How does TEE ensure data security? From encrypted storage to remote authentication
2.4.1 Sealed Storage
TEE allows applications to store encrypted data externally, and only applications within the TEE can decrypt it. For example: private key storage, medical data protection, confidential AI training data.
2.4.2 Remote Attestation
The remote server can verify whether the code running by the TEE is trustworthy and prevent malicious tampering. In the Web3 realm, the environment that can be used to verify that smart contract execution is trustworthy.
2.4.3 Side channel attack protection
The latest TEE design uses memory encryption, data access randomization and other means to reduce attack risks. The community and vendors continue to fix TEE-related vulnerabilities such as Spectre, Meltdown, and Plundervolt.
Chapter 3: The application of TEE in the cryptographic world-From MEV to AI computing, a revolution is happening
As a powerful hardware security technology, Trusted Execution Environment (TEE) is gradually becoming one of the most important computing infrastructures in the Web3 ecosystem. It not only solves the performance bottleneck of decentralized computing, but also plays a key role in areas such as MEV (Maximum Extractable Value), private computing, AI training, DeFi and decentralized identity. TEE-enabled Web3 computing is revolutionizing, bringing more efficient and secure solutions to a decentralized world.
3.1 Decentralized computing: How to solve the Web3 computing bottleneck with TEE?
Blockchain has the advantages of anti-censorship and high credibility due to its decentralized nature, but there are still significant bottlenecks in terms of computing power and efficiency. Current decentralized computing platforms (such as Akash, Ankr) are trying to solve these problems through TEE to provide a high-performance, secure computing environment for the Web3 ecosystem.
3.1.1 Challenges of Web3 Computing
Limited computing power: Smart contracts on blockchains such as Ethereum execute slowly and cannot handle large-scale computing tasks such as AI training or high-frequency financial computing.
Data privacy issues: On-chain computing is transparent and cannot protect sensitive data, such as personally identifiable information, trade secrets, etc.
High computing costs: Running complex calculations (such as ZK proof generation) on the blockchain is extremely expensive, limiting the expansion of application scenarios.
3.1.2 Akash Ankr: TEE-enabled decentralized computing
- Akash Network
Akash provides a decentralized cloud computing marketplace that allows users to rent computing resources. Applications of TEE include:
Private computing: With TEE, users can run confidential computing tasks in a decentralized environment without exposing code and data.
Trusted computing market: Akash uses TEE to ensure that rented computing resources have not been tampered with, improving the security of computing tasks.
- Ankr Network
Ankr provides decentralized computing infrastructure, especially with advantages in the areas of Web3 cloud services and RPC. Application of TEE in Ankr:
Secure remote computing: Use TEE to ensure that computing tasks performed in the cloud run in a trusted environment and prevent data leakage.
Censor-resistant: TEE combines a decentralized computing architecture to enable Ankr to provide censor-resistant computing resources for privacy DApps.
3.1.3 Future Outlook
As Web3 computing needs grow, TEE will become a standard component of decentralized computing networks, making it more competitive in terms of privacy, efficiency and security.
3.2 De-trust MEV transactions: Why is TEE the optimal solution?
MEV (Maximum Extractable Value) is a core issue in sequencing blockchain transactions, involving complex strategies such as arbitrage, sandwich attacks, and clearing. TEE provides a de-trusted MEV solution through trusted computing and encrypted transactions, reducing the possibility of miners and verifiers doing evil.
3.2.1 MEV status and challenges
Front-running: Miners can run away before users can trade to implement sandwich attacks.
Centralized sorting: Flashbots and other MEV solutions still rely on centralized sorters.
Information leakage risk: The current MEV bidding system may expose transaction information and affect fairness.
3.2.2 TEE-enabled MEV solutions
Flashbots TEE: Flashbots are exploring TEE as a key technology for de-trusted transaction sequencing (MEV Boost). Transactions can be encrypted and sorted within TEE to prevent miners or verifiers from tampering with the transaction order.
EigenLayer TEE: EigenLayer uses TEE to ensure the fairness of the retaking mechanism and prevent malicious manipulation of MEVs. Remote certification through TEE ensures that the MEV bidding system has not been manipulated.
3.2.3 Future Outlook
TEE can provide “de-trust sequencing” and “privacy transactions” in the MEV field, reduce miners ‘manipulation, improve fairness, and provide a fairer trading environment for DeFi users.
3.3 Privacy Protected Computing DePIN Ecosystem: How does Nillion build a new generation of TEE-enabled privacy networks?
Private computing is an important challenge in the Web3 ecosystem, especially in the DePIN (Decentralized Physical Infrastructure Network) space. TEE uses hardware-level encryption and isolation execution to provide strong privacy protection capabilities for projects such as Nillion.
3.3.1 Nillion’s privacy computing solution
Nillion is a blockchain-free decentralized private computing network that combines TEE and MPC (Multi-Party Computing) to achieve data privacy protection:
Data fragmentation processing: Use TEE to perform encryption calculations to prevent sensitive data leakage.
Privacy smart contracts: Nillion allows developers to build private DApps, with data only visible inside the TEE.
3.3.2 Application of TEE in the DePIN ecosystem
Smart Grid: Use TEE to protect user energy data privacy and prevent abuse.
Decentralized storage: Combined with Filecoin, ensures that stored data is processed internally within the TEE to prevent unauthorized access.
3.3.3 Future Outlook
Nillion and similar projects may become the core infrastructure of Web3 private computing, with TEE playing an indispensable role in it.
3.4 Decentralized AI: How to use TEE to protect AI training data?
The combination of AI and blockchain is becoming a hot trend in the Web3 space, but AI training faces data privacy and computing security issues. TEE protects AI training data, prevents data leaks, and improves computing security.
3.4.1 Bittensor & TEE
Bittensor is a decentralized AI computing network that uses TEE to protect the data privacy of AI training models.
Through remote certification, we ensure that AI computing nodes have not been tampered with and provide trusted AI computing services.
3.4.2 Gensyn & TEE
Gensyn allows developers to run AI training tasks in a decentralized environment, and TEE ensures data confidentiality.
Combine zero-knowledge proof (ZKP) with TEE to achieve credibility verification of decentralized AI computing.
3.5 DeFi privacy and decentralized identity: How does Secret Network use TEE to protect smart contracts?
3.5.1 DeFi privacy issues
Traditional smart contracts are transparent, all transaction data is public, and there is huge demand for privacy DeFi.
Users want to protect transaction data, such as balances, transaction records, etc.
3.5.2 Secret Network & TEE
Private smart contracts: Secret Network uses TEE to protect smart contract execution, making transaction data visible only inside the TEE.
Decentralized Identity (DID): TEE can be used to store user identity information, prevent identity disclosure, and support KYC compatibility.
3.5.3 Future Outlook
TEE will play an increasingly important role in DeFi privacy and decentralized identity, providing stronger privacy protection for decentralized finance.
Chapter 4: Conclusions and Outlook-How will TEE reshape Web3?
As one of the important technologies in the field of encryption, Trusted Execution Environment (TEE) has shown great potential in many scenarios. As the Web3 ecosystem continues to develop, the role of TEE will become more critical, especially in areas such as decentralized infrastructure, privacy-protected computing, and smart contracts. This chapter will summarize the current status of TEE technology, look forward to how it can drive the development of Web3, and analyze potential business models and token economics opportunities for TEE in the crypto industry.
4.1 How can trusted computing drive the development of decentralized infrastructure?
4.1.1 The need for decentralized computing
With the rise of decentralized technology, traditional centralized computing architectures are gradually unable to meet the needs of the Web3 ecosystem. Decentralized computing can not only improve system security and fault tolerance, but also enhance network transparency and anti-censorship capabilities. However, decentralized computing systems face many challenges:
Trust problem: Trust between nodes is unstable, which may lead to data tampering or untrustworthy calculation results.
Privacy issues: In a decentralized environment, how to protect users ‘data privacy has become a major problem.
Performance issues: Decentralized computing may face performance bottlenecks such as uneven distribution of computing resources and low throughput.
4.1.2 The role of TEE in decentralized infrastructure
TEE technology is the key to solving these problems. By providing a protected, isolated computing environment, TEE provides the following support for decentralized computing systems:
Detrusted computing: TEE ensures the integrity of the computing process and the confidentiality of data even without full trust.
Privacy protection: TEE can perform encrypted calculations without revealing data, protecting user privacy.
Enhanced performance: With the development of hardware TEE solutions, computing throughput is expected to increase significantly.
TEE will become the core technical support in decentralized computing networks (such as Akash and Ankr), promoting the maturity and popularization of decentralized infrastructure.
4.2 Potential business models and token economics opportunities for TEE
4.2.1 TEE-driven business model
With the gradual popularization of TEE technology, several emerging business models and platforms have begun to emerge. The following are a few major business models:
Decentralized computing market: Platforms such as Akash and Ankr allow users to rent computing resources through the decentralized computing market and ensure computing credibility and privacy protection through TEE.
Private computing services: Companies that provide privacy-protected computing services based on TEE-can provide data encryption and computing guarantee services for the financial, medical, insurance and other industries. The profit model is mainly charging per computing task.
Distributed computing and storage: TEE can be applied to decentralized storage and computing platforms to ensure data security and credibility in distributed systems. Related business opportunities include revenue from storage fees and computing service fees.
Blockchain infrastructure providers: Provide specialized hardware or software tools that enable Web3 projects to run smart contracts and execute decentralized applications (DApps) in a TEE environment.
4.2.2 Token Economics Opportunities for TEE
In Web3 and the crypto ecosystem, TEE can be deeply integrated with token economics, bringing new value creation opportunities. Specific opportunities include:
Tokenized computing resources: Decentralized computing platforms can exchange computing resources through tokens. Users and node operators can participate in computing tasks, submit and verify data through cryptocurrency. All computing resources and tasks are exchanged through smart contracts.
Token incentives for TEE services: TE-based private computing services can use tokens as user incentives or payment means to ensure the smooth execution and verification of private computing tasks.
Decentralized identity and data exchange: TEE can provide technical support for decentralized identity (DID) systems, ensure user data privacy, and at the same time promote the popularization of decentralized identity and data exchange through a tokenization incentive mechanism.
4.3 Key development directions for TEE in the encryption industry in the next five years
4.3.1 Deep integration of TEE and Web3
In the next five years, TEE technology will play a more important role in Web3, especially in the following key areas:
Decentralized Finance (DeFi): TEE will be widely used in the DeFi protocol to ensure user transaction privacy and the credibility of the computing process, while improving the security of smart contracts.
Privacy computing: With the improvement of privacy protection regulations in various countries, privacy computing will become a core component of Web3. The combination of TEE with privacy computing technologies such as zero-knowledge proof (ZKP) and homomorphic encryption (FHE) will provide Web3 with a more trusted privacy protection solution.
Decentralized Artificial Intelligence (AI): TEE provides a secure computing environment for decentralized AI and supports secure training and reasoning of AI models, thereby realizing decentralized and intelligent applications.
Cross-chain computing: As the blockchain ecosystem continues to expand, TEE will promote trusted computing between different chains, making cross-chain asset exchange and data processing more secure and efficient.
4.3.2 TEE hardware and protocol innovations
As TEE technology continues to develop, hardware and protocol innovations will drive its performance and security improvements:
Hardware innovation: Next-generation hardware TEE solutions such as RISC-V Keystone and Intel TDX (Trusted Execution Extensions) are expected to surpass existing solutions in terms of performance, security and scalability.
Protocol innovation: The integration of TEE with technologies such as multi-party secure computing (MPC) and zero-knowledge proof (ZKP) will promote the birth of new privacy protection protocols and de-trust protocols.
Decentralized hardware platform: Decentralized computing hardware platform will break through the traditional single-vendor model and promote more small nodes to participate in the trusted computing ecosystem, thereby maximizing the utilization of decentralized computing resources.
4.3.3 Evolution of regulatory compliance and privacy protection
As global privacy regulations become stricter, TEE’s innovation in compliance will be a key development direction in the next five years:
Multinational compliance solutions: TEE technology will be adapted and innovated according to privacy protection regulations (such as GDPR, CCPA, PIPL) in different countries and regions to ensure that decentralized computing environments comply with global data protection requirements.
Transparent private computing: The combination of TEE and technologies such as ZKP will make the private computing process verifiable, enhancing regulatory trust and promoting compliance enforcement.
TEE technology has broad application potential in the Web3 ecosystem. It can not only provide a de-trusted computing environment, but also effectively protect user privacy. With the continuous development of TEE technology, it will play an increasingly important role in fields such as decentralized computing, privacy protection, and smart contracts, promoting the maturity and innovation of the Web3 ecosystem. At the same time, TEE will also spawn new business models and token economics opportunities, bringing more value creation opportunities to the crypto industry. In the next five years, with hardware innovation, protocol development and regulatory adaptation, TEE will become one of the indispensable core technologies in the encryption industry.
