JPMorgan Chase Reportedly Considering Using AZTEC Protocol for Quorum

It looks like JPMorgan Chase is experimenting with the idea of incorporating AZTEC protocol, which “uses cutting-edge zero-knowledge proofs to enable private transactions on Ethereum”, into Quorum platform (which is an enterprise-focused version of Ethereum). ACTEC protocol “enables the logic of transactions to be validated, whilst keeping the values encrypted.”

AZTEC is a London-based blockchain startup headed by mathematician Tom Pocock who believes that “established financial institutions would benefit from using public blockchains.” It is backed by Ethereum Co-Founder Joseph Lubin’s ConsenSys Labs.

AZTEC’s Chief Technology Officer and the creator of the AZTEC protocol is Dr. Zac Williamson, a former physicist at CERN and T2K Japan with a PhD in particle physics from Oxford University. Here is how Dr. Williamson describes the AZTEC protocol in AZTEC’s white paper:

"The Anonymous Zero-knowledge Transactions with Efficient Communication (AZTEC) protocol describes a set of zero-knowledge proofs that define a confidential transaction protocol, designed for use within blockchain protocols that support Turing-complete general-purpose computation.

The protocol is utilizes a commitment scheme that enables the efficient verification of range proofs. This is combined with a set of zero-knowledge Sigma protocols to enable efficiently verifiable confidential transactions.

The reference implementation of the AZTEC protocol is implemented on the Ethereum public blockchain. It can be used to create confidential representations of existing digital assets. At the time of publication, AZTEC zero-knowledge proofs cost approximately 840,000 ‘gas’ to verify on the Ethereum main-net."

And here is how he describes the motivation behind the AZTEC protocol:

"A confidential transaction describes a transaction on a public blockchain net- work, where the value of the transaction is hidden. Existing blockchains have implemented confidential transactions, such as Monero… or ZCash… However confidential transactions have not yet been implemented on a blockchain platform which also supports general-purpose computation through a Turing-complete virtual machine… This limits existing confidential transactions to transactions where the value being transferred is the native cryptocurrency of the blockchain in question.

The AZTEC protocol enables confidential transactions in a generic form that can be implemented on blockchains that support general-purpose computation, such as the Ethereum blockchain… The AZTEC protocol can be attached to existing digital assets defined on these platforms (for example, digital assets that conform to the ERC20 token standard)… The protocol also enables confidential cross-asset trades for digital assets defined on the same blockchain platform via confidential, zero-knowledge decentralized exchanges."

Although there are those who doubt the suitability of a zero knowledge proof based system for enterprise use cases, AZTEC CEO Pocock does not seem worried; this is what he told Coindesk back in November 2018:

"Without scaling we can put one transaction per second through the public network – this will be orders of magnitude faster with upcoming scaling to the network. Even today, it is more than sufficient for CreditMint to move the private corporate debt markets onto the public blockchain. It takes milliseconds to both construct and verify AZTEC zero-knowledge proofs.”

According to Pocock, what makes AZTEC protocol different from earlier attempts at using zero-knowledge proofs to add privacy support to Ethereum is that the AZTEC protocol is “working on the ethereum mainnet (i.e. not a test environment or private chain) and is ‘significantly more efficient in terms of gas costs.’”

In another interview with Coindesk, this time late last month, AZTEC’s CEO revealed that JPMorgan Chase is looking at using the AZTEC protocol for Quorum:

“It’s being tested by the most important bank in blockchain today. JPMorgan Quorum actually.”

Coindesk says that this claim was confirmed by a source working at JPMorgan who told them that the Quorum team was “looking at AZTEC and is ‘generally looking to industrialize zero-knowledge proofs for Quorum.’”

The AZTEC protocol is “live today on the Ethereum Mainnet.” AZTEC says that it will be open sourcing its protocol “under a permissive license in the coming months.”

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