- Aztec’s coding team has reportedly successfully implemented smart contracts that employ zero knowledge proofs, a welcome development for privacy advocates in the global crypto community.
- According to the development team, “The AZTEC protocol can enable confidential transactions for any digital asset on Ethereum, including existing assets.”
- While the AZTEC team has done something impressive, it still remains to be seen if they can pull off a high-degree of anonymity when larger amounts of money are sent.
In welcome news for many in the global crypto community, the Aztec coding team has reportedly been able to successfully implement smart contracts that employ zero knowledge proofs so details of the parties involved as well as the amount being processed are hidden.
Holy Grail of Currencies
A game changer has the Reddit community abuzz with excitement recently. In a thread, it was mentioned the crypto space is advancing toward the “holy grail of currencies.”
MakerDAO cited Alex Van de Sande who tweeted about the zero-knowledge DAI implementation already working live on the main chain.
Van de Sande claims the AZTEC protocol is stable, programmable, and private. In the tweet he also stated “We’re slowly approaching the holy grail of currencies.”
The AZTEC Protocol
Basically, the protocol will enable confidential transactions on the Ethereum network. It also has a working implementation live on the Ethereum mainnet.
The official notes on Github stated the protocol “enables transactions of value, where the values of the transaction are encrypted. The AZTEC protocol smart contract validator validates a unique zero-knowledge proof that determines the legitimacy of a transaction via a combination of homomorphic encryption and range proofs.”
The development team also has this to say about their latest milestone:
“The AZTEC protocol can enable confidential transactions for any generic digital asset on Ethereum, including existing assets. For our proof of concept implementation of the AZTEC protocol, we attached an AZTEC token to MakerDAO’s DAI token. This smart contract can be used to convert DAI from its public ERC-20 form into a confidential AZTEC note form.”
Zero Knowledge Proof
In essence, a zero knowledge proof can be seen as a cryptographic technique that allows the facilitation of transactions without revealing the asset in question or its total monetary worth. This feature was first made popular by ZCash.
After the reported successful execution of the anonymous transaction, many in the crypto world have become curious as to how the protocol’s regulatory future will play out. A spokesperson addressed this by saying:
“The implications of this are far wider than sending around confidential ERC20 tokens—over the coming months we’re going to be releasing our full, open-source implementation of the AZTEC protocol which includes the cryptographic protocols required to manage financial instruments in full zero knowledge. This includes anonymous voting for governance mechanics, anonymous identity schemes (e.g. proving that you’re a member of a whitelisted group, without revealing who in that group you are) and a decentralised zero-knowledge exchange, which will enable people to trade AZTEC assets with each other without publicly revealing the values of the trade.”