Enabling support for multiple asset types on Mimblewimble could be as simple as labeling each transaction output with a publicly visible “asset tag”; however, this would expose information about users’ financial behavior. Confidential Assets (CA) is a technology to support multiple asset types with blinding of asset tags, which builds on the privacy benefits of Confidential Transactions and extends the power and expressibility of blockchain transactions.
As in Confidential Transactions, Confidential Assets allows anybody to cryptographically verify that a transaction is secure: the transaction is authorized by all required parties and no asset is unexpectedly created, destroyed, or transmuted. However, only the participants in the transaction are able to see the identity of asset types involved and in what amounts.
There are two types of assets that can be implemented: predefined and custom. Each type has its advantages and limitations.