How does Zero-Knowledge proof work?
A concrete example of a zero-knowledge proof is the verification of a calculation by a computer. When performing a calculation, a computer must deliver computing power and therefore make an effort. If computer 1 wants to prove to computer 2 that the outcome of the calculation is correct, computer 1 or 2 would normally have to do the calculation again. But with the help of a zero knowledge proof this is not necessary. Computer 1 can prove to computer 2 with the help of ZKP that the calculation has been performed correctly and fairly, without having to do the calculation again.
Why use Zero knowledge proof technology?
Zero knowledge proof technology is becoming increasingly popular in blockchain and crypto because people attach more value to privacy and safety with digital transactions. With this technology we can verify transactions without giving up sensitive information. In the last few years, many protocols with zero-knowledge proofs have been launched and large block chains have built zero-knowledge roll-ups. An important development in this technology is the use of ZK-Snarks, which are widely used in Defi applications, such as private token transactions and shielded and lending shielded. Another important development is the attention to scalability and performance through zkroll-ups.
A ZK-Snark is a specific type of zero-knowledge evidence with which we can verify whether a statement is true, without revealing information about the statement itself. It has already been used for applications such as Zcash, the payment system of JP Morgan Chase and as a safe way to authenticate clients on servers. Zkroll-ups are a scalable solution for blockchain networks that enables the bundling of multiple transactions to a single, larger transaction, which is then registered on the blockchain. ZKroll-ups offer a balance between scalability and safety and are suitable for large-scale, low-latency settings.
Use cases zk-proofs
Zero knowledge proof technology have many use cases, some of which have already been realized; Others are expected to become a reality in the future. Some important ZKP uses are:
Digital identity verification
Zero knowledge proof can be used to verify the identity of users without revealing sensitive personal information. This can be useful in applications such as digital voice systems, where the identity of voters must be verified without affecting their anonymity.
Privacy conservative transactions
Zero knowledge proof (ZKP) technology is often used to offer privacy in digital transactions. A way in which ZKPs are used is to enable privacy-conserving transactions, whereby the identity of the user and the details of the transaction are protected. This can be applied to decentralized fairs and cryptocurrencies such as Zcash. In addition, ZKP can be used to token assets and verify ownership proofs without revealing sensitive information. This can be useful for digital identity verification and proof of ownership without giving up private information.
Global compliance
Some countries have strict regulations for collecting and sharing financial information, which are difficult to comply with for decentralized platforms. Zero knowledge proof can be used to share the required information with supervisors and still to keep it private for other parties. This can help bridge the gap between decentralized platforms and traditional financial institutions, making it easier for Defi to comply with regulations in various areas of law.
The Future of Zero Knowledge in Blockchain
Zero knowledge proof will probably lead to new technological innovations in the future. Some of them with ZKP future developments that deserve attention are: as the blockchain and defi-ecosystems continue to grow and evolve, the need for interoperability between different blockchain networks grows. Crosschain privacy layers will make it possible to carry out transactions on various blockchain networks while retaining the privacy of the parties involved.
Another area to pay attention is the increased use of ZK-Starks (Zeroknowledge Scalable Argument or Knowledge), a newer type of Zeroknowledge proof that is considered more efficient and safer than ZK-Snarks. An advantage of ZK-Starks compared to ZK-Snarks is that the former can be verified faster and do not require a trusted setup.
Zero Knowledge Proof limitations
Zero knowledge proofs are a unique method to verify the truth of information while retaining privacy, but they do not offer a 100% guarantee. Although the probability of verification when the verifier lies is negligible, users must be aware that ZKPs are not bulletproof. In addition, the algorithms used by ZKPs require intensive calculations. In some types of ZKPs, intensive computing is necessary because they require many interactions between verifies and evidence. In other cases, the algorithms are extremely calculation intensive, which could limit the applications of ZKPs.
Zero knowledge proofs are technologies that quickly become popular because they offer unique benefits in the field of privacy and scalability. This technology is increasingly being used in blockchain, cryptocurrency and Defi and will probably lead to new services that are favorable for users. We expect Zero-Knowledge Proofs to play an important role in making safer, more private and more efficient app ecosystems.
