Reasons Why Zero-Knowledge Proofs Are Gaining Attention: A New Era of Privacy and Scalability

One of the most anticipated technologies in the blockchain industry is Zero-Knowledge Proofs (ZKP). This innovative mechanism allows you to prove the truth without revealing any information, and let’s explore how it is being utilized in various scenarios from financial transactions to personal authentication.

What is Zero-Knowledge Proof: A Technology to Prove Validity While Keeping Secrets

The basic concept of zero-knowledge proofs is quite simple. For example, suppose you want to prove that you possess certain secret information. Traditional methods would require you to reveal that information to the other party. However, with ZKP, you can convince the other party that you have it without disclosing the information itself.

This magical technology involves the prover and verifier going through the following steps. First, both agree on common cryptographic parameters and algorithms. Next, the prover generates a cryptographic commitment indicating the existence of the secret information and produces an appropriate response to a random challenge from the verifier. Finally, the verifier checks this response and verifies the consistency between the challenge and the commitment, thereby validating the proof. Repeating this process multiple times increases the trustworthiness.

Core of ZKP: The Three-Stage Structure of Commitment, Challenge, and Response

Zero-knowledge proofs fundamentally operate in three phases. In the first phase, the prover creates a commitment demonstrating the existence of the information. In the second phase, the verifier presents an unpredictable challenge. In the third phase, the prover responds correctly to this challenge, ensuring the authenticity of the information.

The advantage of this mechanism is that the verifier can confirm the existence and validity of the information without knowing its content.

Types of Zero-Knowledge Proofs: Diversity of Technical Options

There are multiple implementation methods for zero-knowledge proofs.

ZK-SNARKs (Zero-Knowledge Succinct Non-Interactive Argument of Knowledge) allow the prover and verifier to generate concise proofs without interaction. They use elliptic curve cryptography, offering high speed and efficiency, but require a trusted setup.

ZK-STARKs (Zero-Knowledge Scalable Transparent Argument of Knowledge) are an evolution of SNARKs. They utilize hash functions, do not require a trusted setup, and are resistant to quantum computers. They are considered superior in transparency and scalability.

Solving Ethereum’s Scaling Challenges with ZK Rollups

The most practical application of zero-knowledge proofs is ZK Rollups. This is a layer 2 scaling solution for blockchains like Ethereum, which dramatically increases transaction processing capacity, reduces fees, and alleviates network congestion.

How ZK Rollups Work

ZK Rollups operate in three stages.

Stage 1: Transaction Aggregation
Multiple transactions are aggregated off-chain into a single data structure. This significantly reduces the amount of data the main chain needs to process, improving network efficiency.

Stage 2: Generation of Zero-Knowledge Proof
A zk-SNARK is generated to prove the validity of the aggregated transactions. This proof guarantees the validity without revealing transaction details.

Stage 3: Verification and State Update on Main Chain
The generated proof is sent to the main chain for verification. Upon successful verification, the state transitions caused by these transactions are reflected on the blockchain, updating the ledger.

Achieving a Balance Between Privacy and Transparency

The reason why zero-knowledge proofs are rapidly gaining attention is their ability to balance privacy protection with transparency. In modern society, data collection by large corporations is advancing, while awareness of personal data protection is also increasing. ZKP can prove validity without disclosing information, potentially satisfying both conflicting demands simultaneously.

From financial transactions to voting systems and authentication processes, the use of zero-knowledge proofs is expanding across various fields. This technology, which can reconcile privacy and scalability, is likely to become a foundational technology in the Web3 era.

ZK Rollup Projects to Watch in 2024

Currently, several ZK Rollup projects are tackling Ethereum’s scaling issues. zkSync focuses on optimizing transaction speed and costs. ConsenSys’s Linea offers an integrated scaling solution utilizing zkEVM technology. Starknet employs zk-rollup technology to significantly improve network efficiency, while Polygon zkEVM addresses gas fee reduction and transaction speed. Additionally, Scroll continues to develop as a layer 2 project utilizing zk-rollup technology.

The progress of these projects is expected to accelerate the practical adoption of zero-knowledge proof technology even further.