r/CryptoMarkets

Over the years, there have been many innovations and developments in crypto. One such area is Zero Knowledge Proof. zk-SNARKs are a type of ZK proof that is lightweight computationally and functions with predefined mathematical circuits. Circuits are how a ZK proof is computed and how the verifier can be certain that the proved information is true or follows the rules without knowing what that information is.

For those who aren't familiar with zk circuits, they prove the validity of a transaction senders address and balances by containing a set of predefined logic gates which information must pass through to be valid.. By leveraging zk proofs, users can prove certain information without revealing additional details, making it possible to conduct transactions without disclosing sensitive information like balances or transaction history and are used throughout ZK products in crypto. They either have utility in scalability (I can prove that the computation happening off-chain is valid without needing to rerun the transaction, think ZK based L2s like ZKsync), OR privacy (I can prove that you have enough funds to send a transaction without needing to know the details of the sender or transaction).

Railgun is a privacy solution deployed directly on-chain which uses ZK circuits. Recently, they have upgraded their circuit infrastructure from 5 circuits to 54, meaning it can handle a lot more different kinds of transaction types. Financial privacy is important to safeguarding individual liberties and also to prevent fraud and hacks. If a scammer doesn’t know how much you have in your wallet, then you become less attractive of a target.

Overall, it's fascinating to see the potential impact of ZK proving systems, and it will be interesting to see how this technology continues to evolve and improve over time. Up until recently, ZK cryptography was the realm of academic mathematics without much practical implementations (on-chain SNARKs were considered impossible before projects like Railgun due to gas constraints) so teams building with this kind of tech are finally realizing the potential of the massive amount of research involved in ZK.