diff --git a/nssa/core/src/account/commitment.rs b/nssa/core/src/account/commitment.rs
index 5bb7532..a0bcfee 100644
--- a/nssa/core/src/account/commitment.rs
+++ b/nssa/core/src/account/commitment.rs
@@ -1,2 +1,2 @@
-#[derive(Debug, Clone, PartialEq, Eq)]
+#[derive(Debug, Clone, PartialEq, Eq, Hash)]
 pub struct Commitment([u8; 32]);
diff --git a/nssa/core/src/account/nullifier.rs b/nssa/core/src/account/nullifier.rs
index 3280f19..4479af0 100644
--- a/nssa/core/src/account/nullifier.rs
+++ b/nssa/core/src/account/nullifier.rs
@@ -1,2 +1,2 @@
-#[derive(Debug, Clone, PartialEq, Eq)]
+#[derive(Debug, Clone, PartialEq, Eq, Hash)]
 pub struct Nullifier([u8; 32]);
diff --git a/nssa/src/privacy_preserving_transaction/message.rs b/nssa/src/privacy_preserving_transaction/message.rs
index edea889..1585be1 100644
--- a/nssa/src/privacy_preserving_transaction/message.rs
+++ b/nssa/src/privacy_preserving_transaction/message.rs
@@ -7,10 +7,10 @@ struct EncryptedAccountData;
 
 #[derive(Debug, Clone, PartialEq, Eq)]
 pub struct Message {
-    public_addresses: Vec<Address>,
-    nonces: Vec<Nonce>,
-    public_post_states: Vec<Account>,
-    encrypted_private_post_states: Vec<EncryptedAccountData>,
-    new_commitments: Vec<Commitment>,
-    new_nullifiers: Vec<Nullifier>,
+    pub(crate) public_addresses: Vec<Address>,
+    pub(crate) nonces: Vec<Nonce>,
+    pub(crate) public_post_states: Vec<Account>,
+    pub(crate) encrypted_private_post_states: Vec<EncryptedAccountData>,
+    pub(crate) new_commitments: Vec<Commitment>,
+    pub(crate) new_nullifiers: Vec<Nullifier>,
 }
diff --git a/nssa/src/privacy_preserving_transaction/mod.rs b/nssa/src/privacy_preserving_transaction/mod.rs
index 898d27c..2d3bba3 100644
--- a/nssa/src/privacy_preserving_transaction/mod.rs
+++ b/nssa/src/privacy_preserving_transaction/mod.rs
@@ -1,3 +1,5 @@
 mod transaction;
 mod message;
 mod witness_set;
+
+pub use transaction::PrivacyPreservingTransaction;
diff --git a/nssa/src/privacy_preserving_transaction/transaction.rs b/nssa/src/privacy_preserving_transaction/transaction.rs
index 7322c75..0640454 100644
--- a/nssa/src/privacy_preserving_transaction/transaction.rs
+++ b/nssa/src/privacy_preserving_transaction/transaction.rs
@@ -1,3 +1,10 @@
+use std::collections::HashMap;
+
+use nssa_core::account::Account;
+
+use crate::error::NssaError;
+use crate::{Address, V01State};
+
 use super::message::Message;
 use super::witness_set::WitnessSet;
 
@@ -7,4 +14,27 @@ pub struct PrivacyPreservingTransaction {
     witness_set: WitnessSet,
 }
 
+impl PrivacyPreservingTransaction {
+    pub(crate) fn validate(
+        &self,
+        arg: &mut V01State,
+    ) -> Result<HashMap<Address, Account>, NssaError> {
+        todo!()
+    }
 
+    pub fn message(&self) -> &Message {
+        &self.message
+    }
+
+    pub fn witness_set(&self) -> &WitnessSet {
+        &self.witness_set
+    }
+
+    pub(crate) fn signer_addresses(&self) -> Vec<Address> {
+        self.witness_set
+            .signatures_and_public_keys()
+            .iter()
+            .map(|(_, public_key)| Address::from_public_key(public_key))
+            .collect()
+    }
+}
diff --git a/nssa/src/privacy_preserving_transaction/witness_set.rs b/nssa/src/privacy_preserving_transaction/witness_set.rs
index 132bb49..6a65cb6 100644
--- a/nssa/src/privacy_preserving_transaction/witness_set.rs
+++ b/nssa/src/privacy_preserving_transaction/witness_set.rs
@@ -1,2 +1,21 @@
+use crate::{privacy_preserving_transaction::message::Message, PrivateKey, PublicKey, Signature};
+
 #[derive(Debug, Clone, PartialEq, Eq)]
-pub struct WitnessSet;
+pub struct WitnessSet {
+    pub(super) signatures_and_public_keys: Vec<(Signature, PublicKey)>,
+}
+
+
+impl WitnessSet {
+    pub fn for_message(message: &Message, private_keys: &[&PrivateKey]) -> Self {
+        todo!()
+    }
+
+    pub fn is_valid_for(&self, message: &Message) -> bool {
+        todo!()
+    }
+
+    pub fn signatures_and_public_keys(&self) -> &[(Signature, PublicKey)] {
+        &self.signatures_and_public_keys
+    }
+}
diff --git a/nssa/src/state.rs b/nssa/src/state.rs
index 3060185..3e266d8 100644
--- a/nssa/src/state.rs
+++ b/nssa/src/state.rs
@@ -1,14 +1,31 @@
 use crate::{
-    address::Address, error::NssaError, program::Program, public_transaction::PublicTransaction,
+    address::Address, error::NssaError,
+    privacy_preserving_transaction::PrivacyPreservingTransaction, program::Program,
+    public_transaction::PublicTransaction,
 };
 use nssa_core::{
-    account::Account,
+    account::{Account, Commitment, Nullifier},
     program::{DEFAULT_PROGRAM_ID, ProgramId},
 };
-use std::collections::HashMap;
+use std::collections::{HashMap, HashSet};
+
+struct CommitmentSet(HashSet<Commitment>);
+
+impl CommitmentSet {
+    fn extend(&mut self, commitments: &[Commitment]) {
+        self.0.extend(commitments)
+    }
+
+    fn set_commitment(&self) -> [u8; 32] {
+        // TODO: implement
+        [0; 32]
+    }
+}
+type NullifierSet = HashSet<Nullifier>;
 
 pub struct V01State {
     public_state: HashMap<Address, Account>,
+    private_state: (CommitmentSet, NullifierSet),
     builtin_programs: HashMap<ProgramId, Program>,
 }
 
@@ -31,6 +48,7 @@ impl V01State {
 
         let mut this = Self {
             public_state,
+            private_state: (CommitmentSet(HashSet::new()), NullifierSet::new()),
             builtin_programs: HashMap::new(),
         };
 
@@ -67,6 +85,34 @@ impl V01State {
         Ok(())
     }
 
+    pub fn transition_from_privacy_preserving_transaction(
+        &mut self,
+        tx: &PrivacyPreservingTransaction,
+    ) -> Result<(), NssaError> {
+        // 1. Verify the transaction satisfies acceptance criteria
+        let public_state_diff = tx.validate(self)?;
+        let message = tx.message();
+
+        // 2. Add new commitments
+        self.private_state.0.extend(message.new_commitments);
+
+        // 3. Add new nullifiers
+        self.private_state.1.extend(message.new_nullifiers);
+
+        // 4. Update public accounts
+        for (address, post) in public_state_diff.into_iter() {
+            let current_account = self.get_account_by_address_mut(address);
+            *current_account = post;
+        }
+
+        // // 5. Increment nonces
+        for address in tx.signer_addresses() {
+            let current_account = self.get_account_by_address_mut(address);
+            current_account.nonce += 1;
+        }
+        Ok(())
+    }
+
     fn get_account_by_address_mut(&mut self, address: Address) -> &mut Account {
         self.public_state.entry(address).or_default()
     }