What are Zero-Knowledge Proofs in Blockchain?
Cyber security is an important concern for global enterprises. With advancements in blockchain, the concerns around building trust and privacy also rise. Hacking and other attacking techniques are advancing too and thus raising the red flag for dapps. Zero Knowledge Proofs (ZKPs) are an attempt to fill these gaps and build better blockchain networks.
Over the past decade, blockchain has fought its way to prove its relevance in the socio-economic setup. Among many issues of web 2.0 applications that it addresses, user data security is a paramount commitment. Hence, blockchain developers are keen to introduce contemporary approaches to building meaningful solutions.
At Antier, we have implemented ZKPs to deliver consumer-centric, secured and speedier transactions in dapps.
What exactly is a Zero-Knowledge Proof?
Zero-knowledge proofs (ZKPs) are a mechanism of validating the information, without revealing it, by using mathematical formulas. This means that if user ‘A’ wants to prove the ownership or possession of a certain type of data to user ‘B’ without explicitly revealing it, they can do so by using ZKP protocols.
ZKPs are different and better than conventional cryptographic techniques that examine, encrypt and then transfer a data set. They instead, analyze the unlinked and irrelevant components of data to mathematically prove the probability of the existence of that data set. Thus, by just using small and insignificant information, ZKPs can protect the data transfer from access and interception.
To better understand ZKPs, here’s an example of user authentication. Let us consider a system that requires a user’s social security number and a driver’s license number to log in. Now, ZKP would pick certain parts of both the identities, link them together and determine the statistical probability of the user’s claim. In this process, it does not access the complete details of both identity types.
What Are The Properties of Zero-Knowledge Proofs?
A successful ZKP protocol has to fulfill the following three conditions:
The statement is true, the protocol followed by the prover and the verifier is true, and then the verifier validates the proof.
The statement is false; the protocol followed is true, still, the verifier will not accept the proof.
If the protocol followed by the prover is true, the statement is true, and then the verifier will accept the proof without accessing any interaction information.
Advantages of Zero-Knowledge Proof
Easy to Understand and Execute
Immensely user-friendly; may not require technical knowledge of codes or analytics.
Productive — Saves Time & Cost
Shortens the transaction timelines in blockchains thereby improving system efficiency.
Assures User Data Privacy
ZKPs are committed to protecting the privacy rights of users. It doesn’t ask for sharing sensitive data.
Safety from Frauds
ZKP users, if educated, know that there’s no need to expose their personal information to any individual or system. Hence, they gain awareness against such entities that attempt to seek personal information without a legit justification.
Types of Zero-Knowledge Proofs
Since blockchain applications largely depend upon privacy and security, ZKPs has emerged to be an integral component here. A simple example would be an authentication system that employs ZKPs to validate the credentials without exposing them.
Understand this from our routine — a user accesses the computer system without any need to disclose it.
Based on the interaction between the ‘prover’ and the ‘verifier’, ZKPs have to use anyone from the two types of protocols: These are:
Interactive ZKPs require the ‘prover’ to complete the challenges issued by the ‘verifier’ to gain the latter’s trust; the trust that the data component in discussion exists and is completely validated. The verification process continues to exchange information between the two parties until the prover assures total satisfaction with the proofs.
The non-interactive ZKP involves the ‘prover’ to complete the challenges issued by a simulated ‘verifier’. Unlike the Interactive ZKP, this one doesn’t have a manual ‘verifier’ and rather uses an automation entity to do the job. Thus, it requires additional computational power.
As expected, blockchain applications use non-interactive ZKPs to complete the transactions without exposing the details or interacting with the parties involved
What are the various use cases of Zero-Knowledge Proof on the blockchain?
Blockchains and other solutions today mostly have encrypted messengers. ZKPs can empower blockchains to go unencrypted and build a valuable and secured messenger platform. This could be huge in the web 3.0 world.
Next-gen file system controls
ZKPs are instrumental in complicating the access paths for hackers. They can create numerous hurdles for manipulators and prevent the alteration or retrieval of data. They do so by adding more layers of security to file systems and logins.
Private Blockchain Transfers
Private blockchain networks have issues with seamless transaction transfers. ZKPs, when integrated with private blockchains, can build a robust protocol to prevent the transactions from illegitimate access.
Multi-Layered Data Access
Entities such as educational, healthcare or financial institutions that deal with mammoth sensitive data have to protect it from external threats. While decentralization does minimize the risk largely, ZKPs make illegitimate access almost impossible in dapps.
A Few Examples of ZKPs
As discussed so far, ZKPs find wide applications in blockchains. Among many use cases, here are the two most popular implementations:
Case Study #1
ZCash & ZK-SNARKs
The ZCash cryptocurrency implements the concept of ZKPs to validate blockchain transactions without accessing the source of money. It doesn’t access the amount of money, the identity of the recipient and other sensitive details.
Their ZKP protocol is known as zk-SNARKS. It stands for Zero-Knowledge Succinct Non-Interactive Argument of Knowledge.
Without any interaction between the proven and the verifier, the ZCash blockchain enables the users to prove their validity to execute a transaction. This ensures end-to-end confidentiality of the transactions.
Case Study #2
Ethereum 2.0 and zk-Rollups
As we know, Ethereum suffers from a sluggish transaction throughput rate and frequent network congestion. Not to miss, the rising gas fee has made it a less preferred blockchain for many dapp development projects.
Ethereum implements ZKP to enable users to confirm transactions in layer-2 while publishing the POV (Proof-of-Validity) onto layer-1. The ZKP protocol here is known as the zk-rollups and will be widely used in Ethereum 2.0.
This will improve many of blockchain’s problems including low speed and high fees.
Zero-Knowledge Proof Protocol Development
So far, we discussed the meaning and impact of ZKPs in the blockchain. As we proceed in web 3.0, user confidentiality of data and identity will become paramount. Dapps that would implement ZKP would have a sustainable future.
Antier is empowering blockchain implementations with the latest generation of ZKP that is cutting down on cost overheads. If you are looking to consult enterprise-level ZKP professionals, reach out to us.