Financial privacy and regulation can co-exist with ZK-proofs — Vitalik Buterin

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A new paper co-authored by Ethereum's Vitalik Buterin dives into privacy pools systems as a tool to achieve privacy in financial transactions while allowing regulatory compliance.

a research paper diving into privacy pools systems as a tool to achieve more privacy in financial transactions, allowing users to prove dissociation from illicit funds through zero-knowledge proof technology.

According to the authors, the concept could provide a balance between honest and dishonest protocol users, potentially enabling financial compliance on-chain in the future: The underlying idea presented in the document asserts that instead of simply using zero-knowledge to prove that a"withdrawal is linked to some previously-made deposit, a user proves membership in a more restrictive association set."

Visual representation of participants’ association set selection. Source: Vitalik Buterin, JacobI llum, Matthias Nadler, Fabian Schar, Ameen Soleimani.

Source: Digital Coin News (digitalcoinnews.net)

 

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