If you are familiar with blockchain, monetary transactions are publicly recorded and verifiable when using a blockchain-based system like Bitcoin. The trade-off for this transparency is a rise in privacy concerns, which has prompted the use of Zero-Knowledge (ZK) proofs.
By enhancing both security and anonymity, zero-knowledge proofs play a crucial role in cryptography and, by extension, blockchain technology. Despite the buzz surrounding it, many still need clarification on what ZK is and how it works.
We will look at everything you need to know about Zero-Knowledge (ZK) proofs in this article.
What is Zero-Knowledge (ZK) Proofs
ZK proofs, or zero-knowledge proofs, let us make a statement without disclosing any underlying information. Two people are involved in this process: the prover, who is attempting to prove the statement, and the verifier, who is checking to see if the prover is correct.
By using an indirect proof called a “zero-knowledge proof,” one can demonstrate one’s knowledge of a secret without disclosing it to anybody else. ZK-proofs are used to convince a verifier that a claim is true without providing any evidence to support the claim itself.
Think of it like this: you want to show your friend that you know the password to a secret club, but you don’t want to give them the password. Using a Zero-Knowledge Proof, you can prove your knowledge of the password to a friend while keeping the password secret. This is especially helpful for private and secure online activities, including authentication, data sharing, and cryptocurrency exchanges.
Polygon is a notable Ethereum layer 2 blockchain that employs zero-knowledge proofs. It is a zero-knowledge rollup that increases Ethereum’s scalability by decreasing transaction fees and processing times.
Regarding cryptocurrency, ZK-proofs are essential for enhancing transaction secrecy and scalability. For example, privacy-centric cryptocurrencies like Zcash (ZEC) enable transactions without revealing the sender, recipient, or other identifying information.
Categories of Zero-Knowledge (ZK) Proofs Work
There are several principles surrounding the ZK-proofs. However, here are some of the most important ones:
- Interactive Zero-Knowledge (ZK) Proofs
- Non-Interactive Zero-Knowledge (ZK) Proofs
Interactive Zero-Knowledge (ZK) Proofs
Interactive ZK Proofs establish proof through back-and-forth conversations between the prover and the verifier. With this interaction, the verifier can ask the prover questions more than once before concluding.
Furthermore, during the course proving, the verifier can ask questions or make several requests. By interacting with the prover, the verifier can ascertain whether the statement is proven true.
Non-Interactive Zero-Knowledge (ZK) Proofs
Here, the prover creates a non-interactive Proof, which the verifier can check without user input. After receiving it from the prover, the verifier can independently verify the proof’s validity.
When several parties need to verify the same statement without recurring contacts, people generally prefer non-interactive proofs due to their efficiency and scalability.
How do Zero-Knowledge (ZK) Proofs Work
Without providing any information regarding the assertion, ZK-proofs allow a prover to convince a verifier of the truth of a statement. Throughout the protocol, the prover and verifier exchange information and work together to build the verifier’s trust in the claim without revealing any secret details.
The concept is particularly useful because it permits verification and authentication without revealing private information. Here’s a step-by-step guide on how ZK-proofs work:
- Setup
- Statement and Witness
- Commitment Phase
- Verification
Setup
It is common practice to specify specific parameters before beginning the proof itself. These parameters are shared knowledge between the prover and verifier and are available to the public.
Statement and Witness
Here, the goal of the prover is to persuade the verifier that the claim or statement being proven is true. This claim usually goes like this: “I have access to this resource” or “I am in possession of the secret key.”
The prover must also have access to some supporting “witness” or piece of evidence. For instance, if someone claims, “I know the value of x,” the value of x itself would be the witness.
Commitment Phase
During the commitment phase, the prover and verifier work together to ensure the accuracy of the claim being proven. This cryptographic promise is typically a one-way process, as the reversal requires extensive computational effort. After the proof begins, the prover is committed to their original declaration and cannot backtrack.
Verification
Upon receiving the proof, the verifier determines whether the prover followed the protocol correctly. If the proof is verified successfully, the verifier will not doubt that the prover knows the facts surrounding the statement.
If the verification is successful, the prover has proven their understanding of the claims without divulging private data, and the verifier accepts the proof.
Types of Zero-Knowledge (ZK) Proofs
There are different kinds of Zero-Knowledge Proofs (ZK Proofs), each with features and applications. Some examples of ZK Proofs are as follows:
- ZK-SNARKs (Zero-Knowledge Succinct Non-Interactive Arguments of Knowledge)
- ZK-STARKs (Zero-Knowledge Scalable Transparent Arguments of Knowledge)
- Bulletproofs
ZK-SNARKs (Zero-Knowledge Succinct Non-Interactive Arguments of Knowledge)
Using a ZK-SNARK, a prover can demonstrate to a verifier (who does not have access to the proven information) that the prover possesses the information without disclosing it. A vital feature of these protocols is their simplicity, which allows for speedy verification thanks to the proof being shorter than the statement ( the “witness”).
ZK-STARKs (Zero-Knowledge Scalable Transparent Arguments of Knowledge)
ZK-STARKs are built with scalability in mind, so they can process massive amounts of data without slowing down. Due to eliminating the setup phase, ZK-STARKs are more efficient than traditional zero-knowledge proof systems like ZK-SNARKs, which can be computationally expensive.
Despite its larger proof sizes, ZK-STARK’s off-chain calculations and public randomness methods make it faster and more transparent than other ZK schemes.
Bulletproofs
Bulletproofs are a form of cryptography used to build practical and compact zero-knowledge proofs. The anonymity and scalability of blockchain-based cryptocurrencies like Monero have been a special focus for bulletproofs.
It is not concerned with the truth or falsity of a statement, as is the case with several other types of ZK-proofs. Instead, it establishes that secret data falls within a given range. Furthermore, the prover can generate a bulletproof without consulting the verifier, making it non-interactive.
Use Cases of Zero-Knowledge (ZK) Proofs
ZK proofs have many applications and have resulted in several developments. These include:
- Identity Verification
- Anonymous Payments
- Authentication
Identity Verification
The development of digital identity systems that are both secure and private relies heavily on ZK-proofs. It reduces identity theft and fraud as users can provide some data (e.g., age, citizenship) without actually disclosing the underlying information.
These proofs are incredibly helpful for balancing identification procedures and personal data protection in decentralized banking systems.
Anonymous Payments
It’s common practice for crypto users to share the public addresses of their cryptocurrency wallets on various online networks. If they are not careful, anyone can trace their identities to their addresses. The privacy provided by ZK-proofs makes it an attractive choice for financial transactions.
Authentication
Using ZK Proofs, you can do away with using a password entirely. There would be fewer security issues associated with passwords if users could verify their identities without disclosing their secret codes.
People can use it to access any service that requires authentication without disclosing personal information. This is helpful for users because of the increased security it provides and for platforms because it reduces the need for elaborate data storage and administration structures.
Conclusion
Developing Zero-Knowledge (ZK) proofs is a significant step forward for cryptography and security. They effectively answer the age-old dilemma of establishing credibility without disclosing private information.
However, ZK-proofs may only be suitable for some use cases or industries because they necessitate specialized training and knowledge to apply correctly. This could limit their use and adoption in various situations.
