Zero-Knowledge Cryptography In 2023: The Year Privacy Becomes a Must
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Zero-Knowledge (ZK) Cryptography is surely one of the most important technologies that will forever change how Web3 operates. We have witnessed several projects that develop, invest and implement zero-knowledge proofs since it guarantees the privacy, security and integrity of blockchain applications. The recent widespread adoption of zero-knowledge cryptography promises a bright future for this technology in the blockchain space.
This article will outline four main predictions for the future of zero-knowledge proofs in 2023.
A Layer 1 smart contract blockchain powered by ZK will be launched
We have seen a few chains such as Mina, ZCash and Celo employ zero-knowledge proofs in their products, however, none of them offer complete on-chain smart contract capability or genuine programmability. They are therefore constrained in what they can achieve. However, this is no longer the case.
In 2023, a smart-contract blockchain with a ZK-powered virtual machine will go live. This might be a feature of Zexe, the covert ledger-based system, or something else. In addition to being far more scalable and being utilized for actual applications, Zcash recently underwent an update employing cutting-edge zero-knowledge research.
According to Alex from CoinDesk, it is simpler to build a brand-new layer 1 blockchain from the bottom up with all the necessary primitives in place than to try to modify Ethereum or other blockchains to work with a technology they weren't intended for in the first place. While Ethereum has unquestionably gained the greatest popularity among smart-contract developers, investors, consumers, and developers are all still looking for other solutions.
If we look back at the history when Ethereum was initially released, lots of people were reluctant to learn a completely new language to write smart contracts. However, given its perks, it ended up being that lots of developers were willing to learn new things and start building on Ethereum. This may be the same case of a ZK-focused chain. We may see a lack of ZK-native coders at first, however, in the long-term, people will gradually realize the superior advantages it offers and start to adapt to it. Additionally, a ZK-native smart contract platform will also offer privacy and scalability. Even though they have ZK in their names, the majority of rollup architectures nowadays solely address scaling issues. To allow use cases that unleash the entire potential of Web3, privacy and scalability will be crucial.
Rollups will stay centralized, while zkEVMs will still be impractical
On Ethereum, a number of rollup implementations, including ZK and Optimistic, are active right now. They are all dependent on a single, central party called a sequencer to organize transactions. The sequencer learns everything about your transactions, and while the rollup's architecture prevents money from being stolen, it still has the chance to benefit from MEV (maximum extractable value) at your cost.
Moreover, rollups will stay centralized as decentralized rollups face several technical and legal challenges. Technically, decentralizing a network effectively necessitates the creation of a brand-new blockchain without the presence of any assets that provide financial stability. From a legal standpoint, it is challenging to decentralize the sequencer in a way that isn't immediately recognizable as a security (e.g., a portion of transaction fees will be paid to the sequencer).
Last, ZK rollups have an extra difficulty in that they do not provide complete smart-contract capability. Different zk-based Ethereum Virtual Machines (EVM) have been proposed, although they are still very much in the theoretical stage and have varied degrees of compatibility to Ethereum. Therefore, even if Zero-Knowledge cryptography has advanced significantly, a decentralized, production system is still at least a year away due to the technical difficulties of a zkEVM.
ZK will be more applicable, helpful and accessible thanks to hardware acceleration
Hardware acceleration is one of the most promising topics for Zero-Knowledge cryptography. Hardware acceleration for zkSNARKs has received considerable attention over the course of the previous year, from FPGAs [field-programmable gate arrays] to mobile devices. The ZPrize competition, in particular, sparked interest in implementing and combining the most advanced hardware improvements for producing zero-knowledge proofs.
This was noteworthy since it wasn't simply one team's idea; it was a coordinated industry effort involving over 32 firms, including Web3 players Mina, Aztec, Aleo, and 0xPARC, as well as chip manufacturers AMD and Samsung.
The competition's results improved the efficiency of fundamental Zero-Knowledge algorithms since these findings are open source, generally relevant to the field, and available to everyone.
Privacy Becomes a Must
People are becoming aware of the drawbacks of public blockchains, particularly the quantity of information that is required in order to participate. Since everything is now public by default, there is no way to safeguard consumers under the current system.
Of course, a lot of businesses declare their support for the creation of features that assist in protecting user privacy. But the sector will increasingly be forced to choose a side by both customers and legislation. The hurriedly presented financial monitoring measure from Senator Elizabeth Warren (D-Mass.) only emphasizes the importance of business cooperation to combat this.
It is an urgent matter. Web3 businesses who genuinely uphold the principles of the industry will speak up for user rights and employ cutting-edge tools like zero-knowledge cryptography to safeguard them. If we don't, we will possibly establish a global financial panopticon that is far more intrusive than our present financial system.
We can conclude that zero-knowledge cryptography will be an integral part of blockchain in 2023. Lots of ZK-powered projects will be developed, and the attention for zero-knowledge proofs will undoubtedly increase, which will lead to further advancement and new innovation of the technology.
This article is compiled based on a research published on CoinDesk.
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