This post was written by Jonathan Rouach, QEDIT Co-founder and CEO
The transparent nature of blockchains is often presented as a virtue of Distributed Ledger Technology (DLT) – it allows all participants to independently verify that shared data and transactional details on a shared ledger are valid. In other words, transparency keeps everyone honest.
While this may be true, transparency on an enterprise blockchain used by competitors within the same ecosystem can be highly problematic. In certain collaborative scenarios, companies must be able to keep their private accounting records and transactional history off-chain for business, legal or compliance reasons.
Lack of privacy on blockchains is routinely cited as an obstacle to adoption in the enterprise space. It was a leading concern raised by executives who participated in Deloitte's 2019 Global Blockchain Survey, and Gartner recently predicted that by 2022, 75% of public blockchains will suffer “privacy poisoning” (i.e., most blockchains will be rendered non-compliant with privacy regulation due to their inclusion of personal data).
All the promises of DLT – new trust-minimized business models, meaningful efficiency gains, and enhanced security – are not always practical without an effective privacy layer to protect sensitive data.
Use of privacy-enhancing technologies like zero-knowledge proof (ZKP) cryptography offers a way forward. At their core, ZKPs allow one party to verify the authenticity of certain data without revealing any underlying details about the data itself.
In the context of a blockchain, they enable businesses to record and authenticate the transfer of assets on a distributed ledger while protecting confidential transactional data. Network members can verify the integrity of the proofs, but they cannot see who sent what, or how much, to whom.
ZKPs have a well-established record in academic circles. They were first introduced in 1989 by Professors Shafi Goldwasser, Silvio Micali, and Charles Rackoff, and they’ve been extensively researched, vetted and improved by computer scientists and cryptographers in the years since.
In terms of practical implementations, Zcash was the first to deploy ZKPs at scale. The technology was subsequently endorsed by leading consultancies and financial institutions like EY and ING, and by research groups within the EU and UN. ZKProof.org, an open initiative led by academics and industry leaders, is actively working to achieve a global standard for ZKP cryptography that will further cement its use as a trusted framework for real-world applications.
As announced at the Ethereal Summit earlier this month, the Kaleido marketplace now has QEDIT’s private asset transfer solution, powered by ZKP cryptography – making Kaleido the first blockchain service provider to offer zero-knowledge proof cryptography as a privacy solution for enterprise consortia.
This landmark partnership is designed to facilitate the implementation of advanced ZKP cryptography without requiring under-the-hood knowledge of the complex mathematics behind it. There’s no need to invest significant development time and resources in deploying ZKP cryptography – our integrated solutions ensure that all the relevant parts (proof generators, verifiers and integration with token contracts) will work seamlessly to preserve companies’ sovereignty over raw transactional details in Kaleido’s cloud environment.
We are proud to be working with Kaleido, a full-stack blockchain SaaS that is enterprise and consortia-ready, and to be joining the industry’s first enterprise blockchain marketplace. Like QEDIT, the Kaleido team are firmly dedicated to accelerating the deployment of enterprise blockchain technology. We welcome the opportunity to make ZKP cryptography more accessible for commercial use, and look forward to helping enterprises harness the full potential of DLT without compromising their privacy.
If your business can benefit from ZKP privacy-enhancing technology, try the QEDIT service on Kaleido’s blockchain cloud today!
Founded by a world-class team of seasoned entrepreneurs, researchers and developers, QEDIT leverages zero-knowledge proof (ZKP) cryptography for enterprise blockchains to enable collaboration among competitors. QEDIT’s Privacy-Enhancing Technology (PET) safeguards sensitive business data in a shared-ledger environment and facilitates companies’ compliance with local data privacy regulations. For more information, please visit qed-it.com and follow us on Medium and Twitter.
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