Its effects on blockchain innovation – Crypto News

The evolution of blockchain security and privacy

Blockchain has become a tech cornerstone. But as it grows, so does the need for privacy. Zero-knowledge Proofs (ZK) emerged as a solution and there’s a new kid on the block called multiparty computation (MPC).

Imagine proving you have a secret without revealing it. That’s ZK, ensuring transaction privacy in a transparent system. But, it has its challenges — notably its computational demands.

Think of MPC as a group of people solving a puzzle without showing their pieces — collaboration without exposure. In the blockchain world, trust is paramount but privacy is crucial. MPC could offer a fresh perspective, potentially allowing users to address both of these concerns.

ZK vs. MPC: A brief comparison

In the realm of blockchain privacy, two contenders stand out: ZK and MPC.

Zero-knowledge proofs

ZK is like a magician’s act, proving knowledge without revealing the secret. It’s brilliant for transactional privacy but can be resource-heavy, especially in larger networks.

Multiparty computation 

MPC is about collaboration. Think of it as a group piecing together a puzzle without showing their individual pieces. It’s efficient, scales well and can be more streamlined for certain use-cases than ZK. ZK dazzles with solo magic, while MPC harmonizes a collective effort. The choice between them hinges on the specific needs of a blockchain application.

Real-world use cases: Combining MPC and blockchain

When MPC meets blockchain, the fusion sparks a myriad of applications:

• Preventing front-running on DEX’s: MPC prevents front-running by securely obfuscating transaction orders and processing them, ensuring no participant can view or act on another’s transaction before it’s executed.
• Financial transactions: Banks can collaboratively detect fraud, analyzing patterns without revealing individual transaction details. 
• Supply chain management: Brands can verify product origins, ensuring authenticity without disclosing trade secrets. It’s 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 ballots with the assurance of both transparency and privacy.
• Healthcare: Research institutions can pool patient data for studies without compromising individual privacy. It can be a step forward in collaborative medical research.
• Digital identity verification: Users can prove their identity in digital platforms without revealing personal data, enhancing online security and privacy.
• Collaborative analytics: Companies can jointly analyze market trends and data without sharing sensitive business information, fostering industry collaboration.
• Entertainment and media: Content creators can ensure digital rights management, verifying user access without compromising on user privacy.
• Real estate: Property transactions can be authenticated, ensuring all parties meet their obligations without revealing their negotiation strategies.
• Secret auctions: MPC ensures the integrity of secret auctions by enabling bids to be computed collectively without revealing any individual bid to either the auctioneer or other bidders, maintaining complete confidentiality until the auction’s conclusion.
• Confidential surveys: This allows for 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: Creating targeted ads based on user criteria without exposing individual user data.
• Drug discovery: Securely sharing chemical and pharmaceutical data for collaborative research without exposing proprietary compounds.

As MPC integrates deeper into blockchain, the horizon of possibilities expand. It can foster an environment where collaboration and privacy are not trade-offs — but partners.

Transparency and privacy

While the blockchain community has long grappled 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 exposing it. 

MPC’s efficiency, especially in scenarios involving multiple stakeholders, sets it apart. Whether it’s banks jointly detecting fraudulent activities or companies collaborating on data analytics without revealing proprietary information, MPC’s applications are both vast and versatile.

As industries increasingly recognize the importance of data privacy — both from a regulatory and a consumer-trust perspective — options such as MPC become a potential solution. It offers a way to harness 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 “Millionaires’ Problem.” This problem involved a way for millionaires to determine who was the richest among them without disclosing their actual wealth. Yao’s theory was revolutionary: It suggested that parties could collectively perform computations over their inputs while keeping those inputs secret, laying the groundwork for complex privacy-preserving protocols.

Staying ahead of the curve

In the dynamic realm of blockchain, it’s easy to become fixated on the familiar. Zero-knowledge proofs have garnered much attention, and rightly so. But in this obsession with ZK, there’s a risk: overlooking the burgeoning 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 blockchain’s bustling ecosystem, zero-knowledge proofs are stalwarts of privacy. It’s not a rivalry between ZK and MPC. While ZK solidifies the defenses, MPC pushes boundaries, offering an edge that’s not about overshadowing — but innovating.

Tiago Serôdio is an accomplished growth marketer and community professional who specializes in hyper-scaling 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. Opinions expressed do not necessarily reflect those of Cointelegraph.