How long did the openness and transparency of the blockchain become its own pain point? The blockchain technology that changes the world combines distributed ledgers, peer-to-peer networks, and consensus mechanisms. It has the characteristics of decentralization, anonymity, non-tamperability, and encrypted operations. However, the current mainstream blockchain adopts an open and transparent ledger. Anyone can query the total amount of funds and fund relevance of each address, which is extremely easy to be monitored, and there are programs on the market to monitor specific addresses and transactions, although the addresses have Anonymity, but most digital currency exchanges need to complete real-name verification, so as long as the digital currency enters a centralized exchange or wallet, there is a high probability that the private information of the digital asset owner can be found.
There are hundreds of billions of dollars of digital currency circulating in the market every day, and these transactions are recorded on an open and transparent blockchain ledger. Any user can find it on it, whether it is account balance, transaction records, and capital flow. under the sun. The application of digital currency is an inevitable trend. Imagine that you use digital currency to buy goods in the store in the future. When you pay to the store, the store will know how much money is in your wallet, where the money comes from, and where the money will go in the future. Although the characteristics of openness and transparency help regulatory agencies to conduct supervision, it is a big challenge for user privacy and security. As the number of users and the utilization rate of digital assets continue to increase, the demand for asset security, privacy and stability has formed a market. The pain point is that it needs to be reformed by new technology.
The current “hidden coins” are all built on their own blockchains, and their own digital currency transactions must be used to achieve the effect of concealment, which does not meet market needs. Such as DASH Dash, XMR Monero and ZEC, the market for these hidden coins is not very hot. Most users still use Bitcoin BTC, Ethereum ETH, TEDA USDT or issued based on ERC-20 specifications. Digital currency.
Red Capital and PAP Labs have developed a solution that can be applied to mainstream digital currencies and can achieve decentralization, security and concealment-the “decentralized electronic cashier’s check system”, which is expected to be in the hundreds of billions of dollars. The asset trading market occupies a place and contributes to the implementation of digital currency to solve the privacy and security pain points of future physical transactions.
The decentralized electronic cashier’s check system PAP SYSTEM , named after privacy and protection , is a set of decentralized “electronic cashier’s check protocol”, built on Ethereum In the smart contract, the code is completely open, and the “indefinite bearer electronic promissory note” that does not require a third-party trust basis, adopts the “zero-knowledge concise non-interactive knowledge argumentation” (zk-SNARK) and a mixed data structure, and at the same time guarantees the holding of the promissory note Some of the anonymity, privacy of message transmission, and privacy of data structure provide the most secure hidden transactions to ensure that the platform’s core data information is safe and correct. Even big data trackers cannot track transactions.
Using Zero Knowledge Proof Technology Zero Knowledge Proof Zero Knowledge Proof
is an encryption protocol that allows the prover to confirm the authenticity of the statement to the verifier without revealing any information about the proven message to the verifier. The simplified non-interactive proof of knowledge (zk-SNARK) algorithm in the zero-knowledge proof can be used to prove the declaration of private data, anonymous authentication, anonymous payment and outsourcing calculations, so in digital currency transactions, the availability of funds for user transactions can be checked , Without revealing the identity of the user and how much money is in his account to network participants, so it is very suitable for hiding the amount and flow of digital assets of the user.
If the mixed data structure
only uses zero-knowledge proof of zk-SNARK, it cannot achieve true on-chain concealment, because the data structure of the smart contract is public. If a single transaction is separately coded and recorded in the smart contract, then Just checking the field changes can connect the depositor and the proposer. The PAP system has joined the hybrid collection technology. Anyone who deposits into the contract to generate an electronic promissory note will be added to a growing data structure, and this structure is protected by encrypted calculations, and only the key of a certain promissory note is known. People who use zk-SNARK to send the encrypted key into the contract can verify that the key is indeed listed in the data structure. The entire process, including the key and the data structure, will not be completely encrypted, so there is no way to know After all, the key belongs to which depositor.
The PAP system supports mainstream Ethereum wallets (Metamask, imtoekn) and mainstream digital currencies (Ether, USDT, and ERC-20 digital currencies). Users deposit digital currencies into the PAP system, and a set of encrypted electronic currencies will be generated at this time. The promissory note, when you want to retrieve the digital currency, you can use the group of promissory notes to redeem it to any address in the PAP system. The process is fully encrypted and protected.
- Figure: PAP decentralized electronic cashier’s check logic
The PAP system collects a handling fee of 0.2% of the promissory note value as income for each service, and creates an exclusive token economy, issuing PAP Token secret coins, and when issuing electronic promissory notes, users can obtain PAP Token secret coins as rewards. PAP can be pledged. Based on the spirit of the sharing economy, the fee income will be proportionally distributed to all users who pledge PAP Token. In addition to the pledge, it can also be taken out at will. Users who hold PAP can participate in community governance, and can vote on related governance parameters, including but not limited to currency denominations, number of rights, handling fees, profit sharing ratio, or vote for new ERC-20 specification currencies to be listed.
Red Capital took the lead in supporting the PAP decentralized electronic cashier’s check system. It is the only company that opens up public participation and shares profits, solves the pain points of digital currency payment and creates a new era of digital currency transactions.
Arnav Reddy was an iconic writer known for his science-fiction and high fantasy short stories. He was raised in a household in which the exploration of article ideas and fact-finding was encouraged. He became one of the most decorated writers in the publishing fraternity, winning multiple prizes for his excellent writing.
Disclaimer: The views, suggestions, and opinions expressed here are the sole responsibility of the experts. No Times of Chennai journalist was involved in the writing and production of this article.