Atomic Swap Using Zero-Knowledge Proofs
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Solution Overview
Problem
Current systems for verifying transaction integrity and asset possession in cryptocurrency and asset exchanges often require escrow accounts, leading to delayed transaction processing and missed opportunities, as they lack efficient mechanisms for ensuring trust and confidentiality.
Innovation Solution
The implementation of an atomic swap system using zero-knowledge proofs (ZKPs) that enables secure and confidential verification of asset possession and commitment between parties, allowing for simultaneous or near-simultaneous asset exchange without the need for escrow, by generating and encrypting ZKPs with specific keys to ensure only the receiving party can decrypt and verify the proofs.
Engineering Contradictions & Design Principles
Engineering Contradiction Analysis
1Reliability
If escrow accounts are used to verify transaction integrity and asset possession, then transaction security is improved, but transaction processing time increases and opportunities are lost
Solution Approach 1:
The patent extracts the verification function from the escrow account mechanism and implements it directly through zero-knowledge proofs between trading parties. The ZKP technology allows parties to verify asset possession and transaction integrity without requiring third-party escrow intervention, thereby eliminating the time delay associated with escrow while maintaining security
Solution Approach 2:
The patent replaces the mechanical escrow account system with a cryptographic verification system based on zero-knowledge proofs. Instead of relying on intermediary institutions to hold and verify assets, the system uses mathematical proofs to enable direct verification of asset possession and transaction compliance, substituting a time-consuming mechanical process with an efficient cryptographic one
2Reliability
If escrow accounts are used to ensure transaction completion, then trust between parties is improved, but transaction speed decreases
Solution Approach 1:
The patent implements preliminary verification through zero-knowledge proofs before transactions are executed. Parties provide cryptographic proof of asset possession and transaction compliance in advance, allowing the trading system to verify trustworthiness without delays. This preliminary action eliminates the need for slow escrow verification while maintaining trust
Solution Approach 2:
The patent substitutes the slow mechanical escrow verification process with fast cryptographic zero-knowledge proof verification. The ZKP system allows immediate verification of trust conditions through mathematical proofs, dramatically increasing transaction speed while maintaining the same level of trust assurance that escrow provided
3Reliability
If conventional transaction verification methods are used, then asset integrity is ensured, but transaction opportunities are lost due to delays
Solution Approach 1:
The patent extracts the asset integrity verification function from conventional slow verification systems and implements it through efficient zero-knowledge proofs. The ZKP mechanism allows parties to prove asset integrity and ownership without requiring time-consuming conventional verification procedures, enabling rapid transaction execution while maintaining integrity assurance
Solution Approach 2:
The patent changes the verification parameter from conventional cryptographic methods to zero-knowledge proofs, which offer superior efficiency. ZKPs allow verification of asset integrity with fewer computational steps and faster execution time compared to traditional verification methods, thereby reducing transaction delays while ensuring asset integrity
Data Source
AI summary
Disclosed herein are system, method, and computer program product embodiments for performing transactions or atomic swaps using zero-knowledge proofs (“ZKPs”). A first system may propose a transaction between with a second system. The first system may generate a first ZKP indicating that the first system has possession of an asset desired by the second system and that the first system is committing the asset to the transaction. The second system may also similarly generate a second ZKP. These ZKPs may be encrypted and exchanged. The second system may receive an encrypted version of the first ZKP, perform a decryption using a key specific to the second system, and verify the ZKP. When the parties verify the ZKPs, this confirms that each party has committed the requested asset and that the transaction may proceed. The transaction may be committed to a blockchain.