The evolution of blockchain security and privacy
Blockchain has become a technological cornerstone. But as it grows, so does the need for privacy. Zero-knowledge Proofs (ZK) emerged as a solution and there’s a newcomer on the block: multiparty computation (MPC).
Imagine proving that you have a secret without revealing it. That is ZK, guaranteeing transaction privacy in a transparent system. But it has its challenges, especially the computational requirements.
Think of MPC as a group of people solving a puzzle without showing their pieces: collaboration without familiarity. In the blockchain world, trust is paramount, but privacy is crucial. MPC could provide a new perspective, potentially allowing users to address both issues.
ZK vs. MPC: A Brief Comparison
In the field of blockchain privacy, two contenders stand out: ZK and MPC.
Zero-knowledge proofs
ZK is like the act of a magician: proving knowledge without revealing the secret. It’s great for transactional privacy, but can be resource intensive, especially in larger networks.
Multi-party calculation
MPC is about collaboration. Think of it like a group putting together a puzzle, without showing the individual pieces. It is efficient, scalable, and can be more streamlined than ZK for certain use cases. ZK shines with solo magic, while MPC harmonizes a collective effort. The choice between these depends on the specific needs of a blockchain application.
Real-world use cases: combination of MPC and blockchain
When MPC meets blockchain, the merger leads to a multitude of applications:
- Preventing front-running on DEXs: MPC prevents front-running by securely obfuscating and processing transaction orders so that no participant can view or act on someone else’s transaction before it is executed.
- Financial transactions: Banks can jointly detect fraud and analyze patterns without revealing individual transaction details.
- Inventory chain management: Brands can verify the origin of products and thus guarantee authenticity without revealing trade secrets. It is a boon for industries where transparency and confidentiality must coexist.
- Voting systems: MPC can revolutionize voting, from national elections to corporate board decisions. Voters can cast their votes with the assurance of both transparency and privacy.
- Healthcare: Research institutions can bundle patient data for research without endangering individual privacy. It could be a step forward in collaborative medical research.
- Digital Identity Verification: Users can prove their identity on digital platforms without revealing personal data, improving online security and privacy.
- Joint analyses: Companies can jointly analyze market trends and data without sharing sensitive business information, promoting industry collaboration.
- Entertainment and media: Content creators can ensure digital rights management and verify user access without compromising user privacy.
- Property: Real estate transactions can be authenticated so that all parties can fulfill their obligations without revealing their negotiating strategies.
- Secret Auctions: MPC ensures the integrity of secret auctions by allowing bids to be calculated collectively without revealing any individual bid to the auctioneer or other bidders, maintaining complete confidentiality until the end of the auction.
- Confidential investigations: This enables the collection and analysis of sensitive data without exposing individual responses.
- Collaborative AI/ML training: It can train machine learning models on aggregated data without direct access to the underlying data.
- Ad targeting without profiling: Create targeted ads based on user criteria without revealing individual user data.
- Drug discovery: Securely share chemical and pharmaceutical data for collaborative research without exposing proprietary compounds.
As MPC integrates deeper into blockchain, the horizon of possibilities expands. It can foster an environment where collaboration and privacy are not compromises, but partners.
Transparency and privacy
While the blockchain community has long struggled with the challenge of balancing transparency with privacy, MPC offers a compelling solution. It’s not just about hiding data; it’s about computing and collaborating on data without ever making it public.
MPC’s efficiency, especially in multi-stakeholder scenarios, sets the company apart. Whether it concerns banks jointly detecting fraudulent activity or companies collaborating on data analysis without revealing proprietary information, the applications of MPC are vast and versatile.
As industries increasingly recognize the importance of data privacy – both from a regulatory and consumer trust perspective – options such as MPC are becoming a potential solution. It provides a way to reap the benefits of shared data without the associated risks.
A brief history of MPC
The concept of multi-party computation (MPC), an essential pillar in cryptography, took its first steps in the early 1980s when Andrew Yao introduced a theoretical solution to a scenario known as the “millionaire problem.” This problem involved a way for millionaires to determine who was the richest among them without revealing their actual wealth. Yao’s theory was revolutionary: it suggested that parties could jointly perform computations on their input while keeping that input secret, laying the foundation for complex privacy-preserving protocols.
Stay ahead
In the dynamic world of blockchain, it’s easy to become fixated on the familiar. Zero-knowledge proofs have received a lot of attention, and rightly so. But in this obsession with ZK lies a risk: overlooking the growing potential of other options.
Staying ahead isn’t just about embracing current trends; it’s about discerning where the next wave of innovation lies. In the vibrant blockchain ecosystem, zero-knowledge proofs are a guarantee of privacy. It is not a rivalry between ZK and MPC. While ZK strengthens the defense, MPC pushes boundaries and offers an edge that is not about overshadowing, but about innovating.
Tiago Serôdio is an experienced growth marketer and community professional specialized in hyperscaling projects.
This article was published through Cointelegraph Innovation Circle, a vetted organization of senior executives and experts in the blockchain technology industry who are building the future through the power of connections, collaboration and thought leadership. The opinions expressed do not necessarily reflect those of Cointelegraph.
