Financial privacy and regulation can co-exist with ZK proofs — Vitalik Buterin

Ethereum co-founder Vitalik Buterin has published a research study paper diving into personal privacy pool systems as a tool to accomplish more personal privacy in financial deals, permitting users to show dissociation from illicit funds through zero-knowledge-proof technology.The file initially discusses one of the most popular privacy-enhancing protocols, Tornado Cash, which permits users to deposit and withdraw cryptocurrencies without developing an identifiable link in between the 2 addresses. According to the authors, the principle might provide a balance between truthful and deceitful procedure users, possibly enabling financial compliance on-chain in the future:” The core concept of the proposition is to enable users to release a zero-knowledge proof, showing that their funds (do not) stem from known (un-) legal sources, without openly exposing their whole deal chart. The association set can include all formerly made deposits, only the users own deposits, or anything in between.” In the example, when one of the users wants to withdraw funds, the individual can specify which association set to be a part of, suggesting users are incentivized to make their association sets bigger to secure personal privacy. The paper even more provides several other usage cases of zero-knowledge evidence for users to show that funds are not tied to illicit sources or to show that funds originate from a particular set of deposits without revealing any more info.

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Ethereum co-founder Vitalik Buterin has published a research study paper diving into privacy swimming pool systems as a tool to attain more personal privacy in monetary deals, enabling users to prove dissociation from illegal funds through zero-knowledge-proof technology.The file initially talks about one of the most popular privacy-enhancing protocols, Tornado Cash, which allows users to deposit and withdraw cryptocurrencies without producing an identifiable link in between the 2 addresses. According to the authors, the principle might offer a balance between deceitful and honest protocol users, potentially enabling financial compliance on-chain in the future:” The core idea of the proposition is to permit users to release a zero-knowledge evidence, demonstrating that their funds (do not) stem from understood (un-) legal sources, without publicly exposing their whole transaction chart.” In the example, when one of the users desires to withdraw funds, the individual can specify which association set to be a part of, suggesting users are incentivized to make their association sets larger to safeguard personal privacy.