Perfect Online Privacy

True internet privacy could finally become possible thanks to a new tool that can—for instance—let you prove you’re over 18 without revealing your date of birth, or prove you have enough money in the bank for a financial transaction without revealing your balance or other details. That limits the risk of a privacy breach or identity theft.

The tool is an emerging cryptographic protocol called zero-­knowledge proof. Though researchers have worked on it for decades, interest has exploded in the past year, thanks in part to the growing obsession with cryptocurrencies, most of which aren’t private.

Much of the credit for a practical zero-knowledge proof goes to Zcash, a digital currency that launched in late 2016. Zcash’s developers used a method called a zk-SNARK (for “zero-knowledge succinct non-interactive argument of knowledge”) to give users the power to transact anonymously.

That’s not normally possible in Bitcoin and most other public blockchain systems, in which transactions are visible to everyone. Though these transactions are theoretically anonymous, they can be combined with other data to track and even identify users. Vitalik Buterin, the creator of Ethereum, the world’s second-most-popular blockchain network, has described zk-SNARKs as an “absolutely game-changing technology.”

For banks, this could be a way to use blockchains in payment systems without sacrificing their clients’ privacy. Last year, JPMorgan Chase added zk-SNARKs to its own blockchain-based payment system.

For all their promise, though, zk-SNARKs are computation-heavy and slow. They also require a so-called “trusted setup,” creating a cryptographic key that could compromise the whole system if it fell into the wrong hands. But researchers are looking at alternatives that deploy zero-knowledge proofs more efficiently and don’t require such a key. —Mike Orcutt