ING Launches System that Makes Blockchain Transactions More Secure

Blockchain technology has the potential of improving security for financial transactions, given its immutability feature, which forbids anyone from changing data stored on the ledger without consensus. However, what happens when users want to keep the data private?

At this moment in time, information being stored on distributed ledgers lacks privacy, due to the fact that each change needs to be verified by a network of nodes. The blockchain team behind ING is well-aware of this issue, hence why they have developed a system meant to protect data privacy on distributed ledgers.

The new code, which is named zero-knowledge range proof, or ZKRP, is reportedly 10 times more efficient when compared to some of the other existing technologies needed to keep blockchain-based information private. ZKRP works by finding a way to demonstrate a truth about pieces of data, without offering information referring to the truth that it is trying to prove. To put things better into perspective, the ZKRP system can technically prove that a payment transaction for instance, is no less and no more than a certain amount without disclosing how much is actually being transacted.

According to Mariana Gomez de la Villa, the head of the ING blockchain program, for blockchain use in the banking sector, one of the main challenges was ensuring data privacy, while also meeting many of the current regulatory reporting requirements. According to her,
“While existing zero-knowledge technology has provided us with a way of overcoming that, the main limiting factor is the resource, and therefore cost, that each verification would generate.” 

Further testing has showcased that this solution is also much more cost-effective when compared to some of the others available on the market. Now that the ZKRP code is available as open-source, any developer can access, download and contribute to the system, for the better of the network.

In the long run, it is expected that the ZKRP technology will encourage many other banks to adopt blockchain technology, given the fact that it solves the data security issue. Now, that exact transaction information no longer has to be disclosed, and thanks to the immutability benefit of the technology, blockchain solutions for the financial market have received a considerable improvement.