Electric Coin Company, the team behind Zcash has recently created Halo, an improved version of zero-knowledge proof. The development assumed importance since it can help organizations manage privacy and security better.
When you avail a digital service from an online provider in today’s Internet age, you first need to prove that you are eligible to avail it. The proof can take various forms, e.g., identity proof, sharing other sensitive information, etc.
While you will likely provide this information since you need the service, this also exposes you to risks. Incidents of data breaches and identity thefts are too common nowadays. The Facebook-Cambridge Analytica scandal is fresh in our memory and it shows that technology giants might not keep your sensitive information safe.
There are concerns about Google too, e.g., how it uses the data it collects about you. Can you prove that you are eligible to avail a service without sharing your sensitive data?
This wasn’t quite possible earlier, however, extensive research and development in the blockchain and cryptocurrency space have made it a reality now. Modern cryptography. is a key component of blockchain and cryptocurrencies.
This branch of science has seen a flurry of research and development since cryptocurrencies captured the popular imagination. The zero-knowledge proof (ZKP) is an innovation in this field that allows you to prove something without divulging the underlying information.
Zero-knowledge proofs: Pros and cons
Zero-knowledge proofs work in an interesting way! This technology enables its users to prove something without them showing anyone the underlying data. Each transaction involving ZKPs has a “verifier” and a “prover”.
The prover tries to prove a fact to the verifier without divulging any other information. They do that using computations, however, they only provide the final output of the computation.
Successful implementations of ZKPs require the following:
- Completeness, i.e., the verifier should be satisfied with the claim of the prover;
- Soundness, i.e., the information that a prover offers must be robust enough to convince the verifier;
- “Zero-knowledge-ness”, i.e., the prover should show nothing else to the verifier.
ZKPs can allow you to prove your identity without divulging sensitive information. This technology can potentially help you to get loans by proving your credit-worthiness, without you divulging any personal information.
While there are several advantages that ZKPs offer, they aren’t easy to implement! How does a business or another organization using ZKPs prove that its ZKP system is trustworthy to start with?
How does the organization prove that someone hasn’t created a secret way to gain administrative rights, and manipulated the data underlying the proofs? Well, there’s a cumbersome and lengthy process to prove this, and it’s called the “trusted set-up”.
This process involves the organization to demonstrate that all administrators have jointly activated the system transparently and none has a secret key to manipulate the system. It’s so complex a process that it adversely impacts the scalability of a ZKP system.
Halo: The improved zero-knowledge proof solution
It’s a concept where the output of the latest transaction in the system contains not only the proof of the genuineness of that transaction but much more than that! The output of the last transaction also has mathematical evidence that all prior transactions have been proven to be genuine using the same process.
As a result, an audience that questions the veracity of the ZKP system now needs to only see the output of the last transaction. Since it contains a proof of the genuineness of all the prior transactions, the verification process is quick.
Zcash is a privacy-focused cryptocurrency. Given the concerns national governments and central banks have around such cryptocurrencies, there have been instances of crypto exchanges withdrawing their support to Zcash. While that requires some work on the part of the Zcash team, it can justifiably feel satisfied with Halo! A Coindesk report indicates that the scientific scrutiny of Halo by experts on modern cryptography is awaited.