Zero-knowledge technology has great potential: FS Insight | coindesk JAPAN

Zero-knowledge (ZK) technology has the potential to revolutionize many areas by providing a safe and efficient way to verify information while maintaining privacy and security, says research firm FS Insight. said in a research report on March 7.

The technology is reported to have a variety of applications in areas such as privacy, security, scalability, interoperability and sovereign identity. “ZK technology is already product-market fit for use cases such as privacy and authentication,” the report said, adding, “We expect to see more ways to implement this technology over time.” added.

A zero-knowledge proof allows one party to prove to another party that something is true without revealing any information.

“It is also a promising way to scale Ethereum to the masses as it can bundle thousands of transactions off the chain into one, giving greater efficiency,” the report said. Protocols such as Aztec, ZK-Sync have successfully implemented zero-knowledge technology, he added. Zero-Knowledge Rollup is Ethereum’s Layer 2 protocol that processes transactions separately from the main blockchain for faster speeds and lower fees.

FS Insight says ZK’s technology’s ability to anonymize transactions on the blockchain could “bear the brunt of regulators and law enforcement” trying to crack down on illegal activities such as money laundering. Says. The report noted that regulators have already targeted Tornado Cash, which uses ZK technology.

Regulators may continue to target ZK technology and may apply anti-money laundering (AML) and know your customer (KYC) measures to ensure transactions are legal, reports report adds.

｜Translation: coindesk JAPAN
｜Editing: Toshihiko Inoue
｜Image: Shutterstock
｜Original: Zero-Knowledge Technology Has Great Potential: FS Insight