A Beginner Guide to Understanding Zero-Knowledge Proofs

A Beginner Guide to Understanding Zero-Knowledge Proofs

Zero-knowledge proofs (ZKPs) permit users of crypto networks to confirm a transaction’s legitimacy without disclosing its specifics.

Zero-knowledge proofs ensure that transaction confidentiality does not happen at the expense of trust. The information below describes how they work and their relevance in Web3.

Understanding Zero-Knowledge Proofs

ZKPs are protocols that aid in verifying the legitimacy of statements on blockchains without providing data that might affect confidentiality. They permit users to confirm a transaction’s validity without divulging transaction details.

In ZKPs, the party proving should demonstrate the claim, while the verifier should validate it. The protocols disclose on-chain that the concealed data is valid, while the prover certainly knows this.

Personally identifiable information (PII) that lands in the hands of malevolent actors can be prone to issues such as identity theft and reputational damage. ZPFs safeguard one’s PII.

Understanding How Do Zero-Knowledge Proofs Work

Zero-knowledge proofs use algorithms to process input information and verify its truthfulness. Projects such as Polygon Zero and StarkNet on Ethereum utilize the protocol in their functionality.

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The three criteria that ZPFs should satisfy to work effectively are:

Zero-knowledge: The verifier cannot access the original input. The statement’s validity is the only available data.

Soundness: An invalid input cannot be validated as being true. The protocol should have measures to reduce the chances of manipulation.

Completeness: As long as the input is valid, the protocol must validate the statement. The proof is accepted cause all parties act honestly, and the underlying data is true.

A basic zero-knowledge proof has three elements, including:

The witness: The prover gives questions only a party aware of the information would know.

Challenger: In this case, the verifier picks a question from the group for the prover to answer.

The response: In this case, the prover answers the question. With the response, the verifier approves the prover’s access to the witness. Afterwards, the verifier proceeds to pick more questions from the set. The numerous questions reduce the chances of faking facts regarding the information.

Zero-Knowledge Proofs Types Explained

The two types of zero-knowledge proofs are: 

Interactive zero-knowledge proofs: This ZPF permits back-and-forth communication between parties. The communication facilitates the confirmation of statement validity.

Non-interactive zero-knowledge proofs: Two parties are involved in a single communication round. The prover shares the data with an algorithm that calculates ZKP. The verifier gets the proof and utilizes another algorithm to verify the user’s knowledge.

Due to non-interactive ZKPs’ convenience, several protocols are under this category. They include:

Zero-Knowledge Scalable Transparent Argument of Knowledge (ZK-STARKs): They are quick due to the reduced interaction between two parties.

Bulletproofs: A trusted setup is not needed. The short, non-interactive ZKPs allow private transactions of cryptocurrencies.

Zero-Knowledge Succinct Non-Interactive Argument of Knowledge (ZK-SNARKs): Their small sizes ease the confirmation process. The protocols use elliptical curves to create a cryptographic proof. 

Permutations over Lagrange bases for Oecumenical Non-interactive Arguments of Knowledge (PLONK): They utilize a universal trusted setup to permit many participants. 

Understanding Why Zero-Knowledge Proofs are Necessary

Examples of use cases explaining the significance of ZKPs are explained below:

Identity confirmation: One does not need to share sensitive data to verify identity. ZKPs provide a means to execute identity confirmation safely and privately.

Compliance: Organizations can adhere to regulatory requirements concerning KYC, money laundering, and other relevant regulations. ZKPs ensure compliance without storing private data on centralized databases.

Security and privacy: Web3’s pseudonymity does not guarantee total privacy since the transaction history can be accessed on public blockchains. ZKP promotes data confirmation without divulging PII, promoting anonymity.

Scalability: ZKPs allow blockchain networks to confirm transactions without disclosing the underlying information. The network’s efficacy is boosted due to a considerable drop in the data stored on the blockchain. 

Final Thought

ZKPs are a critical cryptography tool providing data verification to untrusted or unidentified parties. Web3’s pseudonymous nature complicates data verification. ZKPs solve the matter via revolutionary protocols that ensure safe and quick transactions.

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