Zcash, Banks and Zero Knowledge Proofs

2040

 

I saw this great article on International Business Times UK and had to share.

The article features an interview with Professor Eli Ben-Sasson who you may know from the Zcash History Page is one of the founders of Zcash.

Ensuring privacy of transaction data is a desirable feature at the very least, and probably the sine qua non of distributed banking ledgers. Heavy hitters in the blockchain space such as Ethereum’s Vitalik Buterin andChain.com’sm Ludwin are enthusiastic about the potential of zero-knowledge proofs, which truthfully prove properties of encrypted data without revealing the data itself.

Professor Eli Ben-Sasson of Technion, Israel Institute of Technology is an expert on zero-knowledge (ZK) proofs and part of the Zerocash project and the startup Zcash. There’s a big difference between ZK proofs and almost all currently used cryptography, such as hashing, public key cryptography and digital signatures….

It also has a great illustration as to how Zero Knowledge works:

The ring-shaped cave

A story has been used to explain zero-knowledge protocols, involving a cave shaped like a ring, with the entrance on one side and the magic door blocking the opposite side. In this story, Peggy has uncovered the secret word used to open a magic door in a cave. Victor wants to know whether Peggy knows the secret word; but Peggy, being a very private person, does not want to reveal her knowledge to Victor or to reveal the fact of her knowledge to the world in general.

They label the left and right paths from the entrance A and B. First, Victor waits outside the cave as Peggy goes in. Peggy takes either path A or B; Victor is not allowed to see which path she takes. Then, Victor enters the cave and shouts the name of the path he wants her to use to return, either A or B, chosen at random. Providing she really does know the magic word, this is easy: she opens the door, if necessary, and returns along the desired path.

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However, suppose she did not know the word. Then, she would only be able to return by the named path if Victor were to give the name of the same path by which she had entered. Since Victor would choose A or B at random, she would have a 50% chance of guessing correctly. If they were to repeat this trick many times, say 20 times in a row, her chance of successfully anticipating all of Victor’s requests would become vanishingly small (about one in 1.05 million).

Thus, if Peggy repeatedly appears at the exit Victor names, he can conclude that it is very probable – astronomically probable – that Peggy does in fact know the secret word.

src: ibtimes.co.uk

I encourage you to drop by and read the full article, just be sure you have AdBlock on, because that page is crammed with so many AD’s it’s almost unusable.

Link: http://www.ibtimes.co.uk/blockchains-banks-zero-knowledge-proofs-1565764