zk-SNARK – This is how privacy technology works

Blockchain technologies are fundamentally based on trust. They dispense with central actors and replace them with networks and consensus mechanisms. Bitcoin has proof-of-work consensus and miners that keep the network secure. Trust is created technologically.

Through complex algorithmic procedures, miners ensure that the network can be trusted and does not require a bank, as is the case with centralized systems. However, most blockchains are transparent. Everyone can see how many coins have been sent and at what time. However, if you want to verify transactions without revealing what was sent, you have to use other methods. One popular option for this is zk-SNARK.

zk-SNARK: Certainty without knowledge

zk-SNARK is an acronym that stands for Zero-Knowledge Succint Non-Interactive Argument of Knowledge. What seems very complicated when you first read it is quickly summarized: it is about proving information without revealing it. Thanks to zk-SNARKS, you can easily prove ownership of the private key without having to publish it. To ensure anonymity at all levels, participants exchanging this information do not have to interact with each other. zk-SNARK does all the work. Entire transactions can be encrypted at the same time while adhering to the network’s consensus rules.

Example please?

At this point, let’s use an example to make things clearer. Alice sends Bob money because she owes him something. She agreed with Charlie that he would not be allowed to dance with Bob again until Bob got the money from Alice. But she doesn’t want to tell Charles how much money is involved. Because Alice thinks it’s none of Bob’s business. So Alice resorts to zk-SNARKS. They told Charles that Bob got the money without revealing how much money. Alice proves that she conducted her transaction without revealing what happened in it. So Charles has no knowledge of how much Bob received: zero knowledge evidence is provided.