With the advancements in the field of cryptography, it has a reaching impact on a blockchain platform. The latest cryptographic advances and their potential for cryptocurrencies is new to everyone.
The Director of research at blockchain firm Blockstream and mathematician Andrew Poelstra announced that zero-knowledge proof (ZK-Proof) systems are “one of the most exciting areas of development” in the cryptography providing the basis of privacy-preserving solutions. According to the Mathematician, cryptographers have made significant progress in the application efficiency, and now it works “with more robust and well-accepted cryptographic assumptions.”. He declares cryptography as “one of the vital thrilling spaces of construction.”
Blockchain company Suterusu is working on implementing ZK-Proof-enabled privacy as a second-layer solution on top of Bitcoin and Ethereum’s blockchains. Also, The Company’s Chief technology, Officer Huang Lin claims “Efficient zero-knowledge proofs, when they are applied to decentralized anonymous payments, can significantly improve both its privacy and performance.”
Lior Yaffe, the Co-Founder and Managing Director at Jelurida- the company in the back of blockchains NXT, Ardor and Ignis said, “As a substitute for producing huge blocks of transactions and propagating them throughout the community, miners can use ZKP to generate small knowledge units most effective appearing the account stability adjustments plus cryptographic evidence that no double spend befell.”
According to Syscoin (SYS), Co-founder and Lead Core Developer, Jag Sidhu, this new recursive ZKPs may just permit personal transactions that will be cheaper, smaller, and rapid, just like standard transactions. Last year, Poelstra explained that ZK-Proofs also let the improvement of trustless sidechains, which might bring the capability of altcoins to Bitcoin (BTC).
According to the report of last year, Poelstra elaborated saying, “I believe that now if we need to do an actual two-way peg, we most probably want to get like complete, environment-friendly, general-purpose zero-knowledge proofs, and we’d like some way for Bitcoin validators as a way to validate what’s going down at the sidechain earlier than permitting pegs to come back again.”When Poelstra was questioned about the development of ZK-Proof-based trustless sidechains, he explained that a lot of work needs to be done before the system becomes feasible.
According to him, using such ways for sidechain verification “will demand new evidence techniques that are many orders of magnitude extra environment-friendly.” and concluded stating, “As a neighbourhood, we proceed to transport ahead towards those targets; however, we are nonetheless some distance away.”
In the report, Poelstra suggested that ZK-Proofs can also make Bitcoin more private taking Taproot as an example, saying it can probably render any transaction most commonly indistinguishable from one any other at the blockchain, adding “transaction amounts and the transaction graph are still exposed, which are much harder problems to address.”While talking about the development of cryptography and their impact on crypto, Yaffe explained the function of Multiparty computation (MPC) stating, “MPC enables entities which do not trust each other and might even be negligent or malicious to perform together with computation and agree on the result.”
According to him, verifiable delay function (VDF) is another major development which is similar to proof-of-work mining, “but unlike mining, VDF is impossible to parallelize, opening the potential for equalizing the playing field for small miners.”According to Yaffee, futuristic development in the blockchain technology will work: “Using all of the above, I expect future blockchain products would resemble a blob of information for an outside viewer while users actually holding the keys will be able to see the full history of their transactions. Some of these technologies are not ready for mainstream usage yet, but in the last few years, there were many improvements in this area, and it keeps improving quickly.”
Poelstra also explained interactive multi signatures and defined that this type of technology simplifies complex contracts like escrows or the hash timelock contracts needed to serve as Lightning Network to function.