Thread by @mrkusama_eth

0/ Mega thread on why I think #privacy will be an increasingly important topic in the #crypto space and why I’m really bullish on some projects & their tech!🔒

$SCRT $MANTA $PHA $DUSK $XHV $MINA

Privacy (0/20) 🧵👇

1/ With blockchain & #crypto, a large part of the attraction of the technology is its promise of decentralization, fairness and transparency. However, with transparency comes a lack of privacy

2/ While transactions and messages on the blockchain can be pseudonymous, true privacy is much harder to achieve. Few people want their private details broadcast in a public (even though encrypted) way, whether it is their financial transactions or health records

3/ Additionally, being compliant with certain data privacy regulations (e.g. GDPR) currently means that no private data should not be stored on a permissionless, public blockchain, due to the potential risk of decryption at some point in the future.

4/ For greater use in the real world, these issues of #privacy and data security on a blockchain hence need to be addressed

5/ One important privacy technology are zero knowledge proofs. Zero-knowledge proofs allow one individual to prove to another that a statement is true, without disclosing any information beyond the validity of the statement.

6/ The main objective of these proofs is to reveal as little data as possible between the two parties, which comes with the added benefits of less data needing to be transmitted/stored

7/ This concept plays an important role in #zkSNARK systems. @zcash was the first widely available application of zkSNARKs $ZEC

8/ When talking about zk-SNARK proofs, SNARK stands for "Zero Knowledge Succinct Non-Interactive Argument of Knowledge"

9/ “Succinct” means that the proofs are small in size & can be quickly verified. “Non-interactive” means that little to no interaction is needed between prover & verifier. "Argument" is mostly a formalism, while "knowledge" refers to the prover actually having the evidence

10/ The privacy of $ZEC is hence derived from the fact that transactions in the network remain encrypted but are still verified as valid using zero-knowledge proofs. Therefore, those that are enforcing consensus rules don’t need to know all of the data underlying each transaction

11/ @MantaNetwork, @DuskRegDefi or @MinaProtocol are exciting examples of smart contract layer 1 platforms leveraging on this technology👀🚀

$MANTA $DUSK $MINA

12/ Another interesting tech approach to #privacy are “trusted execution environments” (TEEs). In very simple terms, #TEEs can be described as an area within a computer system that no one can access except with a trusted agreement

13/ The #TEE runs within the main processor but outside the normal operating system, providing a way to store data or execute code privately and without modification

14/ As each TEE holds its own cryptographic keys, it only discloses its content to third parties that fulfill all the criteria defined to keep it trustworthy

15/ @PhalaNetwork uses a TEE-Blockchain hybrid architecture for privacy. They aim to provide a confidential computation and data protection service to other #Substrate-built blockchains $PHA

16/ This will enable them to access confidential smart contracts running inside a #TEE enclave in the central processing unit, functionally isolated from the external operating system and the hardware, ensuring security and confidentiality

17/ @HavenXHV is a Proof-of-Work blockchain network based on the cryptonote protocol that was originally started as a fork of $XMR and has a strong focus on private digital assets.

18/ @HavenXHV uses what is known as a ‘mint & burn’ process to convert between all supported assets on the network. So, when a user converts from $XHV to $xUSD, they mint $xUSD and burn the equivalent $USD worth of $XHV

19/ @HavenXHV provides genuine hope for true privacy, liberation from oppressive regimes & inflation. It allows for private txs & minting of various synthetic assets, that are stored in untraceable, digital offshore vaults. Out of reach to governments & regulators $XHV

20/ More detailed threads on zkSNARKs, $SCRT, $MANTA & $DUSK to follow over the next days, so make sure to follow & turn on notification 🔔

#PrivacyMatters

Make sure to check out those 👇👀

$SCRT:

https://twitter.com/mrkusama_eth/status/1486014300527505408

$DUSK:

https://twitter.com/mrkusama_eth/status/1486103606201921551

$MANTA & zk-stuff:

https://twitter.com/mrkusama_eth/status/1486383616447889409