The Netherlands based Bank ING researches zero-knowledge proof
The development of the zero-knowledge proof moves forward as Dutch ING banks use the system for KYC.
A Zero knowledge proof shares information that is necessary in order to prove something about a specific entity. ING is a Dutch Bank that has reportedly been planning to further explore the privacy features that the Blockchain technology can offer to their system.
The Amsterdam-based financial institution has announced that it will be launching its Zero-Knowledge Set Membership (ZKSM) solution at the Sibos Banking Conference.
What is a Zero-knowledge proof in finance
The Bank has been utilizing simplified versions of the standard Zero-Knowledge proofs technology, which allows for users to verify that they are in possession of certain information, without the need to reveal that information, with no interaction needed between the verifier and prover. The Zero-Knowledge proof is useful for the accurate verification of important data sets such as proving that a number falls into a particular range, without having to disclose any actual number.
This verification process will be useful to determine whether an employee’s salary fits within a certain range, without revealing the exact amount of salary an individual receives. If a company or any other entity desires to know the approximate amount a person is earning, or in order to decide if they can offer that person a certain service like financing a mortgage. The Zero-knowledge proof system can be applied in these circumstances. When added to the Blockchain this can become useful for Banks, governments and other financial institutions.
The sharing of information is necessary
The user’s information is always protected and private by only sharing the information about that person that is absolutely necessary. Zero-Knowledge proof on the Blockchain is generally computationally lighter in comparison to the traditional data verification methods.
The ING Bank focuses primarily on providing direct retail, commercial and investment banking services and is now researching the possibility of utilizing ZKSM in order to validate any alphanumeric data. This includes a normal combination of letters, numbers, and symbols that joins with a specified set of data.
The validation process is required in order to determine the accuracy of more complex data sets such as information that is used to calculate geographic positioning with the proven dimensions. The ING bank requires these in case a client needs to clear a KYC process check, this may include personal details such as if a person is an EU citizen or not. This can now be done automatically without the need for an individual to reveal their country of residence.
The research that the ING Bank has put into cryptographically based Zero-Knowledge proof and products are starting to develop into an open-source system. This means that source codes can be reviewed by anyone that is interested. The research was also peer reviewed by academics in the field.
Improving current systems of privacy and trust with DLT security
The co-founder of the privacy coin Zcash and a research assistant at the MIT University, Dr. Madars Virza, also did a review on ING’s contributions to the ongoing development of the Zero-Knowledge proof technology. Together with the chief innovation officer of wholesale banking at ING, stated that the Banks’ development on the open-source distributed ledger technology like what Ripple is currently using will be based on the ZKSM project.
As stated by Annerie Vreugdenhil:
“At ING, we are fortunate to have some of the best minds in the industry working on our programme. And we are excited that our groundbreaking solutions are now ready to be implemented and tested.”
The goal will be to structure an initial community-led effort that is focused on improving the user’s privacy and sensitive data that can be misused or stolen.