If you are a blockchain enthusiast, you must have heard about confidential transactions, range proofs, ZKPs, and even about Bulletproofs. This article explains the various privacy protocols and focusses on the concept of Bulletproofs.
Learning of the Blog
- A Quick Review to Blockchain Technology
- Briefing Zero-Knowledge Proof and its Types
- Defining Bulletproofs
- What’s So Special about Bulletproof Protocol?
- Concluding Lines
A Quick Review to Blockchain Technology
From the past few years, there has been an increasing effort to leverage blockchain, which is defined as a peer-to-peer, decentralized, distributed ledger technology that maintains a record of transactions and works without involving any third-party intermediary. As blockchain is revamping and transforming almost all sectors of the industries, it is gaining a lot of attention from blockchain developers and researchers. Blockchain is known for its transparency, immutability, and security, but privacy is still one of the main topics of interest.
As a solution to this issue, there are various cryptographic mechanisms such as Zero-Knowledge Proof and the more advanced cryptographic tool, Bulletproofs.
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Briefing Zero-Knowledge Proof (ZKP) and its Types
Before understanding the concept of Bulletproofs, it is important to understand what exactly is ZKP. ZKP is a digital protocol that offers a unique method where a user can prove to another user that he knows an absolute value without actually conveying any additional information. It has the potential to reform the way data is collected, used, and transacted with. Thus no information, either from the sender’s end or receiver’s end, can be compromised in any sense.
ZKP can completely eradicate the need for passwords as well as the use of any other sensitive data when facilitating a transaction. Zero-knowledge authentication protects the data from criminals, replaces the risky nature of password-only authentication, and helps in keeping online transactions safe and secure.
These are categorized as Interactive ZKP and Non-Interactive ZKP. In interactive ZKP, the prover needs to convince the verifier about knowing the knowledge. This protocol requires interactions, and by interacting, the prover can prove, and the validator can validate the knowledge.
While in non-interactive ZKP, no interaction is necessary between the two parties (i.e., prover and verifier). Moreover, unlike interactive ZKP, which suffers from limited transferability, it allows verifying one’s statement to a larger group of people.
Bulletproofs, which is non-interactive zero-knowledge proofs, was proposed in December 2017 by Stanford’s Applied Cryptography Group with contributions from the Blockstream and the University College of London.
We can define Bulletproofs as more advanced and more efficient ZKPs that can be used to extend multiparty protocols and are known to provide a more efficient version of confidential transactions range proofs.
They are much efficient and secured, and most importantly, they do not require a trusted setup.
In comparison to range proofs(a type of ZKP), these are considered faster and are well suited for the distributed and trustless nature of blockchains. Moreover, they are capable of enormous space savings, creating substantial long-term cost savings, lower fees, and faster verification times.
What’s So Special about Bulletproof Protocol?
Now, as we have understood Bulletproofs’ concept, let’s explore how this cryptographic method differs from other privacy protocols.
No Trusted Setup Required
Unlike other protocols such as zk-SNARKS, bulletproofs stand out exceptionally well as they do not need a trusted setup. In a one-time setup, users have to implicitly trust whoever created the keys to destroy them after they are done because if not, they can be used to create an unlimited amount of the native token, undetected.
Reduces the Size of Transactions
Bulletproof helps in reducing the size of transactions as it allows the prover to aggregate (when a prover combines multiple range proofs into one) various range proofs for transactions with multiple outputs into a single proof.
Faster and Space Savings
When compared to the current implementations of range proofs, bulletproofs have faster verification times. Unlike STARKs, they reduce the size of transactions and also minimizes the space efficiently. Moreover, they support full 128-bit security under standard assumptions without requiring any trusted setup.
The tradeoff with confidential transactions has also been their larger size. Bulletproofs offers the opportunity to reduce this tradeoff without compromising privacy and security. Like other privacy protocols such as zk-SNARKS, bulletproofs have all the components to become an exceptional privacy protocol in the next wave of blockchain applications. These may not be a breakthrough in cryptography, but undoubtedly they hold a special place in blockchain space.
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