The debate in the decentralized finance (DeFi) community rages following sanctions from the U.S. Treasury against a popular crypto mixer, but the real progress is happening below the surface. Technologies underpinning privacy-preserving protocols, like zero-knowledge proofs, have found new compliant use cases that go far beyond finance itself. Zero-knowledge proofs are a tool that can transform the way we handle sensitive data, allowing information to be verified without disclosing the underlying contents themselves, providing value and protection in an age where individuals have too little. Zero-knowledge proofs are not that new; they have been around for decades. Their mathematical logic can be applied to any number of data exchanges and any realm that can benefit from decentralization and added security. Imagine, for example, that you need to verify your age with a driver’s license, but without sharing other irrelevant data like your address, height and weight — that’s what zero-knowledge technology can do on a massive scale. When applied to our banking system and credit scoring, zero knowledge can and will revolutionize financial access for populations that suffer discrimination, and the same can apply to tax verification or a privacy-preserving voting system.
Read more : How zero-knowledge proofs will guarantee compliance for DeFi adoption.
