If you’ve spent time building on Ethereum, Solana, or any of the major L2s, Canton will feel unfamiliar in ways that go deeper than syntax. The differences reflect fundamentally different design priorities.
I spent three years learning threshold signature and MPC custody infrastructure, then two years shipping it professionally for a DEX.1A distributed exchange (DEX) is similar to a tool like Coinbase, except the operators of the network don’t know each other. It’s a fully distributed, permissionless network where end users can exchange one form of cryptocurrency for another, anonymously. The transition to Canton forced me to re-examine assumptions I didn’t even realize I was carrying.
Let’s walk through some of the key architectural differences and what they mean in practice.
Consensus: Global State vs. Local Agreement
On Ethereum, every validator processes every transaction. The entire network agrees on a single, globally ordered state. This model is conceptually simple but creates well-known bottlenecks — gas limits, MEV,2Miner extracted value or maximal extractable value, depending on who you ask, is the value that can be obtained by ordering transactions on a blockchain. congestion pricing — because every transaction competes for the same finite resource.
Canton works differently. Transactions are processed by synchronizers — independent domains that only involve the parties relevant to a given transaction. If Party A and Party B are settling a bond trade on Synchronizer X, parties on Synchronizer Y don’t process that transaction.
They never even see it in the first place.
The Global Synchronizer coordinates cross-domain settlement when transactions span multiple synchronizers, but it doesn’t replay every transaction on the network. The result is horizontal scalability that doesn’t degrade as the network grows.
Ethereum model:
TX → All validators → Global state update → Block
Canton model:
TX → Relevant parties on sync domain → Local confirmation
→ (if cross-domain) Global Synchronizer → Atomic settlement
This is more than a simple optimization; it’s a different philosophy. Ethereum optimizes for universal verifiability — anyone can audit anything. Canton optimizes for need-to-know — only the parties who should see a transaction can see it.
Privacy: Opt-In vs. Default
On most public chains, privacy is additive. You start with full transparency and layer privacy on top — Tornado Cash, zk-rollups, shielded transactions. Each approach has tradeoffs in cost, complexity, and particularly in regulatory risk.
Canton inverts this. Sub-transaction privacy is the base layer. When a transaction executes, the protocol decomposes it into sub-transactions. Each sub-transaction is only visible to the parties whose rights or obligations are affected. Validators confirm the transaction’s validity without learning its contents.
Consider a simple three-party workflow: a buyer purchases a tokenized bond from a seller, and a custodian confirms settlement. On Ethereum, all three parties’ addresses, the asset, and the amount are visible to every node on the network. On Canton, the buyer sees the purchase, the seller sees the sale, and the custodian sees the settlement confirmation — but none of them see the others’ full view of the transaction.
Most importantly, nobody else on the network sees any of it.
This is the reason Visa, DTCC, and Goldman Sachs are building on Canton rather than on a public L1 with an after-the-fact privacy layer bolted on.
Beyond the privacy of the exchanges, though, everything is completely auditable. It’s not an anonymous network; each party has the ability to audit its own view of the world (and respond to regulator inquiries). Strong KYC3Know Your Customer requirements equally make the system private rather than anonymous.
Smart Contracts: Imperative vs. Declarative
Solidity is imperative. You write functions that mutate state, manage storage slots, and handle control flow explicitly. This gives you flexibility but also gives you reentrancy attacks, integer overflow bugs, and the endless parade of smart contract exploits that have cost the industry billions.
Daml is declarative. You define templates — structured descriptions of contracts that specify who can do what, under what conditions, and what happens when they do. The runtime enforces authorization, atomicity, and lifecycle management.
For example, here’s a minimal Daml template for an asset transfer:
template Asset
with
issuer : Party
owner : Party
id : Text
where
signatory issuer, owner
choice Transfer : ContractId Asset
with newOwner : Party
controller owner
do create this with owner = newOwner
A few things to notice. The signatory clause means both the issuer and current owner must have authorized this contract’s creation. The Transfer choice can only be exercised by the current owner (the controller). And the transfer is atomic — the old contract is archived and the new one is created in a single transaction. There’s no intermediate state where the asset exists in two places or nowhere.
Compare this to a Solidity ERC-20 transfer, where the developer must manually implement access control, handle the approval/transferFrom pattern, guard against reentrancy, and hope that no one finds an edge case in the state transitions. Daml eliminates those categories of bugs by construction.
Token Economics: Speculation vs. Utility
Most public chain tokens derive their value from speculation, staking yields, or governance rights. Canton Coin (CC) is a utility token in the narrow, original sense of the term: it pays transaction fees on the Global Synchronizer and rewards network participation.
Transaction fees are denominated in USD and paid in CC, which means the fee structure is predictable regardless of token price volatility. Fees paid in CC are burned,4Permanently removed from circulation. creating deflationary pressure tied directly to network usage rather than to market sentiment.
For developers and institutions, this means you can forecast infrastructure costs without worrying about gas price spikes during network congestion. For validators, rewards come from operating infrastructure that processes real financial transactions rather than inflationary token emissions.
What This Means for Developers
If you’re coming from the Ethereum ecosystem, building on Canton requires adjusting your mental model in a few key ways:
You won’t be writing raw state management code. Daml handles the contract lifecycle, and you’ll spend more time modeling business workflows than managing storage.
You won’t be optimizing for gas. Canton’s fee model is predictable and USD-denominated. Batching transactions to save on gas isn’t a concern.
You won’t be building privacy infrastructure. Sub-transaction privacy is built into the protocol. You focus on business logic; the network handles who can see what.
You will need to think carefully about party topology — which participants are involved in which transactions, how synchronizers are configured, and how cross-domain settlement flows work. This is where Canton’s complexity lives, and it’s where the right tooling makes a meaningful difference.
That’s the segue to next week, when I’ll talk about why I chose to build on Canton after cutting my teeth in the broader crypto space — and what I’m doing about that developer tooling gap.