Tag Archives: proof

Binance Adds ZK-SNARKs to Improve Privacy of Proof of Reserves Report

Binance Adds ZK-SNARKs to Improve Privacy of Proof of Reserves Report
In Brief
  • Binance introduces zk-SNARKs into Proof of Reserves to prove changes to user asset balances with greater anonymity.
  • The exchange is also adding SHIB, DOT, CHZ, and SOL to the assets covered in future reports.
  • Crypto VC Nic Carter suggests the zk-SNARKs add significant privacy value to Proof of Reserves reports, but reports must be backed by other regulations related to an exchange’s fidcuiary duties.

Binance announced that it would introduce zero-knowledge proofs to improve the quality of its Proof of Reserves report.

Zk-SNARKs will allow Binance users to securely and privately confirm nonnegative balances and changes of balances using information from its proof of reserves Merkle tree.

Binance Makes Progress in PoR Roadmap, But Auditors Are Missing

As part of the announcement, Binance said it added SHIB, DOT, CHZ, and SOL to the assets covered by its proof of reserves report. Additionally, the exchange will open-source the zk-SNARKs code to improve transparency and to help other exchanges improve their reporting. Binance has yet to reveal the frequency of forthcoming reports.

Zk-SNARKs, an abbreviation of zero-knowledge succinct on-interactive arguments of knowledge, confirms a statement’s truth without revealing any information about the statement.

The zk-SNARK will verify that each user’s asset balance set is part of a global state of user funds Binance maintains. Additionally, it will anonymously ensure that the user’s net balance is not negative by including collateral posted for margin trading. Customers can use zk-SNARKs to verify that the Merkle root hash in Binance’s Merkle tree reflects asset balance changes. The Merkle root hash is essentially a cryptographic summary of all user balances. Changes to a user’s asset balances will prompt an update of the Merkle root hash, which the zk-SNARK will confirm.

Binance’s addition of zk-SNARKs is the last step in a transparency roadmap outlined at the end of November 2022. Part of its roadmap involved securing the services of a third-party auditor to audit its proof-of-reserves. This initiative has been jeopardized by the exit of accounting firm Mazars from the crypto space. Mazars was the accounting firm that conducted an agreed-upon procedure for the exchange’s first proof-of-reserves report.

Crypto VC Says Zero-Knowledge Proofs Only One Part of the Puzzle

While the technical implementations of PoRs vary, crypto VC Nic Carter expects zero-knowledge methods to supersede the technical limitations of traditional Merkle tree reports.

However, while zk-SNARKs represent an important step in the right direction for the world’s largest exchange, it is still only one part of a broader toolkit that can prevent collapses like FTX. Blockchain expert Anndy Lian agreed, saying that while not perfect, zk-SNARKs provide a “big enhancement.”

According to Carter, exchanges need additional rules to segregate corporate and user assets and protect customer assets from bankruptcy. Additionally, U.S. lawmakers must create a viable market for accounting firms to invest in tools to oversee PoR attestations. Doing so would also encourage offshore exchanges to conduct PoR reports.

Because audits are expensive and done quarterly, Carter suggests that they accompany, rather than replace, more frequent PoR reports, which provide updated customer reassurances.

Source: https://beincrypto.com/binance-adds-zk-snarks-proof-of-reserves-report/

 

Anndy Lian is an early blockchain adopter and experienced serial entrepreneur who is known for his work in the government sector. He is a best selling book author. The latest book is Web4: The Age of Autonomous Intelligence.

www.anndy.com
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Panel Discussion: The Future of NFTs in Emerging Industries

Panel Discussion: The Future of NFTs in Emerging Industries

Proof of Origin: The Future of NFTs in Emerging Industries panel discussion is part of the launch of the first movie-based NFT Marketplace with the first-of-its-kind Proof of Origin NFT from a Marvel artist.

The panel consist of the following experts and moderated by James Pratt, an award-winning actor, director and is one of Australia’s Top 5 under 35 in Entertainment.

Phil Ingram is the CMO at Lepricon.io, a community-owned and governed prediction games platform. He is a former VP of Remote Lands, and specializes in strategic marketing, digital & social marketing, and strategy implementation!

Anndy Lian, Advisory Board Member at Hyundai-DAC, is a serial blockchain entrepreneur known for his work in the government sector. Recently appointed as Chief Digital Advisor for the Mongolian Productivity Organization. Anndy is also an author, thought leader, investor, advisor, and board member to several other companies in Asia and Europe.‍

Jarred Winn, Founder of Winn.Solutions, is a growth hacker at heart, and founded the Bay Area’s first blockchain-centric full-service digital marketing agency. He’s also a former SVP at Binance, a blockchain philanthropist, and a strategic advisor.

Ty Blackard is the Co-Founder & COO NFTY Labs, and CCO at FomoHunt. He built blockchain’s most innovative data curation platform and is creating the next layer of authentication infrastructure by utilizing Web3 based tools that allow for utility management through NFTs.

NFTs have the potential to completely change commercial art, virtual real estate, advertising, music and more. In fact, all items digital can be NFT. The panellists were being asked which other industries would benefit most from NFT.

For membership organizations, staying on top of the latest technology is not only beneficial but can keep you ahead of the curve. Phil Ingram sees the importance and mentioned that “NFTs could be proof of membership in a guild.”

NFTs will make it possible for gamers to take their skins, avatar, or gaming character into every game they play. “Gaming and eSports will be a huge embarking in the NFT space. This is the lowest hanging fruit.” Jarred Winn commented during the panel.

Anndy Lian added that “Please do not restrict NFT to just movie posters or fractioning the film. You can place NFTs in the film. Viewers can watch the film and hunt for the NFT collectables within the film too.”

You can view the live-streamed “Proof of Origin” event on YouTube where the famed comic book artist Rob Prior launched the NFT Marketplace with the burning of an original painting inspired by the Wolf of Wall Street film to mark its NFT mint.

 

The panel discussion can be found at: https://youtu.be/7Cn2OT1r8_4

 

 

Anndy Lian is an early blockchain adopter and experienced serial entrepreneur who is known for his work in the government sector. He is a best selling book author. The latest book is Web4: The Age of Autonomous Intelligence.

www.anndy.com
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