'Big Four' Accounting Firm, EY, Launches 'Private Transaction' Prototype for Ethereum Blockchain

  • EY's prototype demonstrates that private transactions can be processed on the public Ethereum blockchain.
  • EY's prototype aims to take advantage of the security and network effect of Ethereum's blockchain.

Ernst & Young (EY), a London-based “Big Four” professional services firm, announced on October 30th that it had launched the EY Ops Chain Public Edition (PE) prototype - which is reportedly “the world's first implementation of zero-knowledge proof (ZKP) technology” on the permissionless Ethereum blockchain.

According to the announcement’s press release, EY’s ZKP-based prototype will allow organizations to create “product and service” tokens on Ethereum’s public blockchain, while allowing their issuers to keep their transactions logs private.

ZKP technology, which allows users to reveal only as much information as absolutely necessary about their data sets, will be used by EY Ops Chain PE to facilitate “private token transfers.”

Similar To ERC-20, ERC-721 Tokens

Notably, the private transfers can reportedly be processed without interfering with Ethereum’s proof-of-work (PoW) consensus protocol. The EY Ops Chain PE was developed by London and Paris-based EY blockchain labs, and its tokens are fundamentally similar to the ERC-20 and ERC-721 (for non-fungible tokens) standards.

Launched in April of 2017, the EY Ops Chain consists of “a set of applications” and developer tools that help companies deploy enterprise level blockchain-based solutions.

Paul Brody, the blockchain innovation leader at EY Global, said: 

EY Ops chain PE is a first-of-its-kind application and a major step forward that empowers blockchain adoption. Private blockchains give enterprises transaction privacy, but at the expense of reduced security and resiliency. With zero-knowledge proofs, organizations can transact on the same network as their competition in complete privacy and without giving up the security of the public Ethereum blockchain.

Paul Brody

 

Buterin Is Considering Zero-Knowledge-Proofs Tech For Ethereum

Notably, Ethereum co-founder Vitalik Buterin has also expressed an interest in ZKPs as he said in late September that Zcash’s zk-SNARKS technology could allow Ethereum to scale to 500 transactions per second (TPS).

Currently, the Ethereum network is only able to process around 15 TPS - which is a major reason why many companies that issued tokens on Ethereum’s blockchain are now looking, or already have, moved their tokens over to another blockchain.

Commenting on how public blockchain networks usually offer a greater level of security and help reduce costs compared to private ones, Brody said:

The biggest challenge for enterprises' blockchain adoption is the ability to on-board business partners into their private or consortium blockchain network. Using the standard, secure infrastructure of a public blockchain while keeping their transactions private, businesses greatly reduce the expensive and time consuming process of setting up private networks and on-boarding business partners one at a time.

Paul Brody

"Real-World Solutions" On Public Blockchains

James Wester, the research director at Dallas-based Worldwide Blockchain Strategies, IDC, an organization that studies how distributed ledger technology (DLT) will impact the financial services industry and healthcare, remarked:

The development of tools that enhance the capabilities of public blockchains will spur enterprise adoption of public blockchains and are crucial to the growth of blockchain technologies in general. The ability to ensure privacy while retaining the security and resilience of public blockchains is an important consideration. It offers an opportunity for enterprises to begin building real-world solutions on public blockchains and is an important step in the evolution of the technology.

James Wester

The privacy-focused EY Ops Chain PE solution also lets users record their transaction history so that they may access it later on by using the proprietary “EY Blockchain Private Transaction Monitor prototype.“

A “release roadmap” for the solution is currently being reviewed and EY aims to introduce the “product offering” at some point in 2019

Blockchain Is Well-Positioned to Help the Unbanked, OKEx Executive Says

Lennix Lai, OKEx’s Financial Markets Director, has recently made two presentations in Davos, where the 50th World Economic Forum (WEF) Annual Meeting is taking place, to spread the word about blockchain technology.

In his two presentations – made at the Russia House 2020 and EmTech Investment Meeting 2020 events – Lai argued that even though there are highly developed countries throughout the world, over 2 billion people are still being excluded from the traditional financial services over the operational costs associated with setting up branches in underdeveloped areas.

Lai noted that “unbankedness” is one of the “biggest hurdles in human wellbeing” and a great opportunity for the blockchain and fintech sector to make a difference in the world by helping those left behind by the traditional financial sector get access to financial services that could boost their living standards. At Russia House 2020, Lai said:

Blockchain and cryptocurrencies appear to be a solution to the problem by providing a digital, decentralized financial system that can work mutually-beneficially with traditional markets to substantially lower the operational costs and serve the areas traditional banking cannot cover.

Lai added that OKEx is committed to “bringing a robust and trustable environment to cater to crypto users.” The cryptocurrency exchange, he added at the EmTech Investment Meeting 2020 talk, sees global regulators a start endorsing the space in the future, and the volatility of BTC dropping.

This would make the flagship cryptocurrency a favorable alternative asset for mainstream finance. He also mentioned the growing decentralized finance space, which “reflects that people are starting to brace a free, open, permission-less financial system.”

The options, futures and spot markets OKEx offers, Lai said, let cryptocurrency users manage the price fluctuations in the space, and 2020 will see the exchange continue its efforts on stablecoins, its OKEx wallet, and derivatives products.

He concluded his presentation at the EmTech Investment Meeting 2020 saying OKEx believes “blockchain can achieve an inclusive sustainable development as well as financial inclusion for all, banked and unbanked.”

Featured image via Unsplash.