What’s all the fuss about Zero Knowledge? MIT’s Technology Review named it one of the breakthrough technologies of 2018 alongside artificial embryos, quantum materials, 3-D metal printing and zero-carbon natural gas. Banks, especially the incredibly innovative ones we have in Amsterdam, like ING, have publicly announced research in this area. Even JP Morgan Chase, despite the fact that its CEO Jamie Dimon famously called Bitcoin a fraud last year, have been working with the privacy enhancing technology through a collaboration with Zcash.
While most blockchains, including Bitcoin and Ethereum, currently offer practically no privacy, the rich and powerful of the world — including U.S. president Donald Trump — would prefer that their financial records are kept secret. Zero knowledge proofs are mathematical techniques for proving significant facts about an individual without revealing any other information. For regulatory purposes, for example, a potential customer could prove he was a resident of the EU by making an anonymous transaction, all without revealing his name, address or anything else.
Governments and multinational institutions have been engaged in a 21st Century arms race to gather massive and diverse centralized collections of information. This data can not only be used for advanced research but also as a political weapon, as we’ve recently seen with the Facebook – Cambridge Analytica scandal. What’s significant about this recent controversy is how it starts to reveal real dangers of AI and bulk data collection that you could previously only read about in sci fi novels or watch in a film.
Armed with massive amounts of this centrally controlled data, artificial intelligence can be misused to persuade individuals and groups of individuals, including organizations or political parties, to encourage engage in ethically questionable, racist, criminal and even violent activity against one another. Financial and transactional information especially of the kind gathered under the guise of Know Your Customer and Anti-Terrorism regulation is among the most valuable information that can be misused for this purpose.
What Zero Knowledge Proofs can do is restore privacy and allow the individual to control or selectively disclose digital info via a decentralized architecture that may also provides the security of blockchain technology. Even for those who are still willing to trust certain institutions to keep our personal information, many of these organizations have suffered from cyber attacks and massive data leaks or have had their security undermined in various other ways.
During Bitcoin Wednesday on 2 May, 2018, we’ll debate all of these issues and more in a panel discussion with four experts on digital identity via distributed ledger technology.
