Gelato Clob Season Episode #2 I Hibachi: Privacy-First ZK Exchange on Celestia - with Varun Kumar

Varun Kumar (Hibachi + HashFlow founder) joins Gelato founder Luis Schliesske and Rise co-founder Sam Battenally to discuss Hibachi - the privacy-first exchange built with ZK proofs and Celestia DA. They explore how Hibachi achieves sub-second latency maintaining user privacy, the evolution from RFQ to CLOB design, and why privacy matters for institutional traders. This episode dives deep into TSS-MPC custody, SP1 proving costs, and the future of decentralized exchanges beyond just "no KYC."
Want to understand the cutting edge of privacy-preserving exchanges? Watch the full episode for insights on ZK-powered CLOBs, market maker dynamics, and the path to competing with centralized venues.

00:00 – Intro: Privacy vs Privacy pronunciation debate
00:40 – Varun's background: From HashFlow to Hibachi
04:54 – Hibachi's three pillars: Performance, privacy, and exit guarantees
16:37 – Privacy architecture: Encrypted blobs on Celestia
17:21 – Why traders care about privacy: Strategy protection & security
19:49 – Deposit/withdrawal privacy and "compliant Tornado Cash"
20:01 – ZK performance breakthrough: From 8 hours to 10-15 minutes
25:34 – SP1 integration: Writing in Rust
26:07 – Orderbook matching in ZK proofs
29:51 – Proving costs: Breaking even at $2 per trade
30:00 – Bridge architecture: No bridge needed, just ZK proofs on-chain
36:30 – CLOBs Free option problem and market evolution
41:31 – $5 memecoin traders, not whales
42:37 – Cancel priority: FIFO vs activity-based preference
50:37 – Market maker priorities: MPC wallets, not FIX APIs
50:36 – Surprising insight: Traders don't care about self-custody
59:59 – End game vision: Consumer-facing exchange, not infra
60:00 – Exchange differentiation: Novel products over just speed/privacy
64:29 – Geographic arbitrage and the death of KYC requirements
64:54 – Future outlook: Multi-winner market with 4-6 dominant players