Zero-knowledge proofs will revolutionize privacy and trust in digital interactions. Protocol Labs report reveals its transition to real-world commercial applications.
What is zero knowledge proof
Zero-knowledge proof is a strong cryptographic technique that allows parties to prove information without revealing the underlying data.new report freed Protocol Labs today discovered that ZK proofs are reaching an inflection point as research projects transform into real-world commercial applications across industries.
Zero-knowledge proofs allow one party (the prover) to prove knowledge of certain information to another party (the verifier) without revealing the actual data. This builds trust and enhances privacy in digital interactions. For example, ZKP could allow someone to prove they have enough funds to make a purchase without revealing their bank balance.
The report highlights recent major funding rounds, over $725 million invested in 2022, patent filings, rising public interest and the traction of core use cases such as blockchain, decentralized finance (DeFi) and machine learning as momentum signs. It also explores technical challenges surrounding efficiency, scalability, and security assumptions.
“ZK-proof will help erase the boundaries between web2 and web3, especially within the identity space, as it is currently the only technology that spans both domains. More generally, ZK-proof will significantly reduce computational complexity, and help deliver a truly high-performance blockchain.”
Kitty Horlick, Director of Rarify Labs, a blockchain interoperability development company
Market prediction with zero-knowledge proof
Cryptocurrencies such as Zcash (ZEC) rely on ZKP for private transactions. The report cites predictions that the zero-knowledge proof market revenue will reach US$75 million in 2024 and exceed US$10 billion by 2030, with web3 alone requiring nearly 90 billion proofs that year.
Researchers see particular promise in combining ZK proofs with artificial intelligence and machine learning models that can be trained and exploited without exposing the underlying data. Efficiency improvements such as recursive proofs make ZKP more practical at scale.
After years of hard work, we finally have an effective proof solution. What I mean by efficient is that the proof time is getting closer to normal computation time. The closer we get, the more verifiable applications we can have. By 2023, it will be close enough to verify blockchain transactions. Maybe in the future it can be more closely verified for any calculation.
Nicola Greco, scientist at distributed research laboratory CryptoNet
While optimism abounds, researchers warn that work still needs to be done to address limitations in computational complexity, scalability, security assumptions and hardware requirements. Standards development and education are also critical to adoption.
Protocol Labs gathers input from more than a dozen teams in the innovation network of more than 250 companies to advance ZK proofs and related technologies such as Polygon, StarkWare, and Aleo. The researchers emphasized that real-world applications will drive development beyond the crypto field.