The world has come to a point where blockchain is now becoming a vital aspect of economies. Governments are beginning to understand the value of a distributed system of things and they are opting for Central Bank Digital Currencies (CBDCs). Major payment systems like PayPal will begin to support crypto payments, buying, and selling soon. In no time, Banks and governments will begin to look to existing blockchains to help with interoperability to ease cross-border payments. CBDCs will not help if Banks from different countries are unable to interoperate to allow international transactions. They need neutral grounds which has been proven over the years and built especially for this reason.
Of the existing public and most popular blockchains, Stellar stands out as a blockchain with unique abilities built to be the remedy and safe haven for central banks. Denelle Dixon, CEO of Stellar Development Fund (SDF) has made appearances and presentations to different government parastatals and international bodies over the past few weeks on the potential of Stellar protocol. The core aspect of Stellar is its mission to make sending funds as easy as sending emails.
SDF has also been working on many fronts to make Stellar very easy to use especially for newbies. Examples are protocol updates proposed by SDF to help users in Key management and recovery, claimable balances, and sponsored reserves to help developers onboard new users without rigor, etc. Lately, SDF has also organized Stellar Quest to help its community learn how easy it is to use the protocol while being rewarded as they complete quests. The event for many users has been unveiling as they learn how to easily create and send new assets on the stellar blockchain.
But amidst all these, questions still arise in the minds of many on the potential of Stellar Consensus Protocol for Banks and governments being a public blockchain. Banks and governments may need to create private accounts, send, and receive confidential transactions. These transactions and accounts cannot be made public else it may lead to disaster. Stellar being a public blockchain created to make every account balances and transactions public may not be a perfect fit for that purpose.
May 9th, 2019, Oleg Andreev, a developer at SDF introduced Zero-Knowledge Virtual Machine (ZkVM). ZkVM “is an experimental multi-asset blockchain architecture for scalable and confidential smart contracts.” The project will enable stellar accommodate private accounts and transactions. Zero Knowledge allows accounts to proof they are legitimate without revealing details about their legitimacy (e.g. account balances and transaction details) to the verifier. ZK-proofs will enable private accounts conceal their details when they appear on the public ledger. June 5th, 2020, Andreev also made a presentation on ZkVM and Slingshot on Stellar Engineering Talks. The last Git-Hub updates on the project was September 19th, 2020, which means works are still underway and developers are cooking something great for the community.
This kind of implementation when ready will attract a lot of private entities and banks.
Will you consider Stellar Protocol an Hybrid-Blockchain if and when it implements ZkVM and Slingshot?
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