Episode 260: ZK in 2023 with Kobi, Guillermo, and Tarun

Transcript

foreign [Music] welcome to zero knowledge I'm your host Anna Rose in this podcast we will be exploring the latest in zero knowledge research and the decentralized web as well as new paradigms that promise to change the way we interact and transact online [Music] so we're back this is our first episode of 2023 and our first after a three-week hiatus very nice to be back here I hope you've had a little bit of a break um yeah so this week's episode we will be wrapping up our 2022 wrap up with a

little catch up since our last episode and we're also doing a look forward into 2023. I'd say like most of the episode is really about ZK use cases we sort of explore areas where we think there might be some ZK activity we also check in on kind of where certain use cases are at um yeah and I hope you like it before we kick off I do want to let you know that there is an upcoming ZK Summit nine it's happening on April 4th in Lisbon I'm very excited to once again invite some of the best researchers and practitioners in this space to present new research new ideas implementations it should be a really good time we're also going to be doing a hackathon around this time so keep an eye on our

Twitter or telegram channels for more info I've added the link to apply for The Summit in the show notes tickets are always limited and it's always better if you go through the application process early you have a better chance of getting a ticket that way so be sure to sign up soon and hope to see you there and now Tanya will share a little bit about this week's sponsors risk zero and anoma ever wish you could use existing rust libraries in ZK a friendly reminder from the team at risk zero that you can things like proof of Checkmate blinded proof of password complexity and even proving things like protobufs are straightforward when you can use existing code to learn more check out the risk zero video tutorials from the last CK hack at youtube.com forward slash at risk zero that's

r-i-s-c-z-e-r-o you can also follow them on Twitter at risk zero to make sure you don't miss their upcoming 1.0 launch and the alpha launch of the Bonsai Network so thanks again risk zero [Music] anoma's first fractal instance namata is launching soon namada is a proof of stake L1 for interchain asset agnostic privacy nomada natively interoperates with fast finality chains via IBC and with ethereum via trustless two-way bridge for privacy namata deploys an upgraded version of the multi-asset shielded pool circuit otherwise known as masp which allows all assets fungible and non-fungible to share a common shielded set this way transferring a cryptokitty is indistinguishable from transferring eth dye Adam osmo namata's

native asset or any other asset on namata the masp circuit's latest update enables shielded set rewards directly in the shielded set a novel feature that funds privacy as a public good visit nemata.net for more information and join the community on Discord via discord.gg forward slash nomada so thanks again anoma and now here's our episode [Music] so I want to welcome back to the show my awesome sometimes co-host tarun Guillermo and Kobe welcome what up hey nice to be here a quick note Kobe did let us know that he might have to bounce off this one early but in the meantime I hope we can cover some really good ground on CK use cases basically I want

to use this episode to talk about what is exciting in ZK and what might be coming next this is our look forward part of the wrap-up episode that we started last month so maybe before we jump into the future stuff let's get a quick recap of what actually happened since we last spoke so we recorded our last episode on December 12th I think in it we were even talking about SBF going to jail or not going to jail that day after we recorded he was arrested and then at the same time tarun you had mentioned something like I hope there aren't any more dominoes that can fall before the end of the year like there was something else you were kind of worried about for those that last 19 days of the year I wanted to check in about that one what are

those dominoes and two have they Fallen I mean I guess the last one was the Genesis uh dcg stuff which seems to have erupted like last week yeah where uh the vinco Y kind of are like basically saying they're gonna sue them and trying to get uh dcg to fire its founder so uh that didn't blow up but it's not looking like it won't blow up if that makes sense wow it's not looking like it won't blow up is what what a statement but I do Wonder like given that this seems to be primarily in the C5 or like crypto in Trad Phi Realm does this still have an impact on defy yes and no I mean I think a lot of the

centralized lenders did actually Source liquidity from G5 or provide it so there's some sense in which they're they're still kind of connected but it probably doesn't really affect it in the long run I think the bigger thing is just more like net Market confidence in like the centralized entities that haven't died uh you know if everyone is dying like dominoes then and no one survives then it's sort of like that would be bad from the perspective of like there's no on-ramps anymore but yeah I I don't think it would have like destroyed stuff but it would have obviously caused a lot of Havoc um especially if they have to liquidate private positions and stuff like that um a little bit like FTX caused kind of

this huge Panic do you think we're still at risk of that then yeah recording today on January 11th are we still in a position where like something like that can happen in the next month or do you feel like somehow the worst is behind us after the last six months I don't think I ever uh can assert that type of claim again yeah well maybe this has been a good time to switch gears and start talking a little bit more about what's coming up and specifically what's going on in the ZK space over the holidays Kobe and I went on another podcast we went on epicenter and in that we actually covered a lot of zku's cases I can add the links to that in the show

notes if people want to see the whole thing but actually I wanted to start off this look forward into the new year with sort of a short summary of some of those interesting use cases that we mentioned there Kobe I don't know if you want to take it away and and start this off yeah let's talk about some experiments I think I think like one thing that we're we're seeing more this year which we haven't seen before or I guess last year is that we see people being able to use the ziki tooling to deploy applications that are user facing and are a bit further away from just research or just proof of Concepts so I think like we had this

cabal application which was really fun like you could have groups that are pseudonymous in Discord and like other other locations which is ZK membership which previously I think the only on-chain use case that we had for it was for mixers and like Anonymous messaging like in semaphore but that was a fun one there was also this cool experiment with recursive snarts which like the first time that was deployed by an independent developer and rather than like a company like Mina that was deploying it but so you can prove how close you are to vitalik oh yeah this is the ethos project so what's your degree of separation like that's the if dos uh

yeah so I have a good number I think but uh yeah but because because I I because I know the developer that's the only reason I have a good number okay yeah it's like a score you get a score for how close you are but what's the I actually have always been curious what's the actual linking Point like what's the tool that's yeah is it GitHub Twitter ether what is it I think basically it's just a signature because you get a link from someone that they say uh like this link shows that you know the person that sent you the link oh and then you just wait like a recursive proof that that takes the previous proof that is in that link that shows okay this is degree two

and then you can create a new proof of degree three and it's private right so you so you know the degree but you don't know yeah exactly you don't know the whole path that's interesting this is it's what is it it used to be five degrees from Kevin Bacon wasn't that one okay it's kind of a stupid number that like six the six was like not even like the median of the degree distribution yeah I don't know actually where they came up with it I think it just six was just like the movie was called that oh right they just like but it has it had very little fact factual basis I think in the zika space it's more like three two two okay fine I mean I don't know two degrees Yeah I mean it everyone through the diameter of the DK graph has

to be I I would I would pretty small like I I feel like the expected diameter of like if I did a random walk is less than two yeah no I mean like even in math from erdo it's like still quite small right it's like six or something or seven is that yeah anyone on the planet or something what is the map for mathematicians to like this like very famous yeah well I mean the best version of these is the uh was it what was it is the like um Natalie Portman Kevin Bacon airdush number or whatever because Natalie Portman has a finite error dose number I think it's like three oh wow something quite low uh and then basically like yeah nice well there's

yeah the Metallica bacon urd oceanographic is what it is or something like that yeah and it's like uh if you've ever put out an album right and like you probably have a finite Metallica number because you work with someone who's worked with someone who's worked with someone who like well worked on the one some metallic album there then there's a finite Bacon number which means that you started a movie or did were in some piece of media uh which had someone who had someone who had someone you know who like six-fold who would wear whatever it was wasn't part of the bacon movie yeah uh okay I'm making a movie and then so on and so forth for papers as well yeah so that's the coolest oh unfortunately I'm still seeking a finite uh Erdos Bacon number wait wait wait you don't have a finite

iridesh Bacon number no I have a finite Erdos number do you know I think it's like three three I think it's actually I think yours is three two mine actually I think we're both yeah we're both three for the same reason yeah uh which is Steven yeah so oh actually I have another route to three but yeah it's oh interesting oh that's spicy okay yeah but it's it's a funny it's a funny thing uh which means like I guess Guillermo you gotta go become an actor soon I know clearly that's the that's the obviousness very clearly you're in the wrong career right now you gotta you gotta quit start acting and like figure out how to get close to people who've been in movies with Natalie Portman

it would be cool to have the lowest number but I think the lowest number is pretty low actually it's like four so yeah I mean actually this is a good question though in crypto maybe there's like you know when social networks first started growing you know let's say even my space like 2000 mid 2000s there was a lot of stuff about people trying to be like how many friends can you really have online and like people were like oh there's like this like limit of like 100 or whatever and then people kept coming with all these different like half graph Theory half sociological like observation per like statements of like oh this is like how many friends you should have or how many degrees of separation you should be an interesting question is like in in

the crypto world how is that different given the lack of identity like does that number go down does the number go up are we going to see these kind of like sociological theories for like how connected certain addresses should be there's also isn't it sort of weird online because there's also people who have multiple identities you might be friends with like three people that are the same person right right that's what I mean so it's it's sort of like interesting of like you know I guess in Solana right like the the one guy who deployed all the contracts that uh got used uh in their in their like D5 Bull Run I'm sure he has like the highest you know degree you know highest connectivity of everyone he's like uh wow if you ran page rank on Solana you probably just get to him or

Anatoly like with probability one always star all right let's continue then let's keep keep uh the new use cases rolling yeah and I think another cool one that I've seen that they also had fun participating in was this a Anon thing where you click they created this Twitter users I guess that allow you to tweet if you were part of some known group so one of the groups that they created was the Dell hack victims I guess um and yeah I I think I was the only one that tweeted from there yeah I'm really anonymizing myself but uh yeah hey Anon was the project yeah so like

they have multiple Twitter users for different use cases like um Xerox Park participants and hack victims and some other ones so like I really like the integration with the real world rather than just being this own chain use cases yeah so that's what I found fun about all of these three tarune I want to throw to you is there any like upcoming ZK projects experiments that you think have high potential something maybe to look out for yeah I mean I think we talked a little bit about it in the summary of like the idea of language models having some form of distributed training or distributed verification you know I

think we're very far from that but the fact that you know people have been able to snark imagenet and snark like medium-sized neural Nets sort of says you know we're in a world where people could get this verifiability and you know I think if you look at open AI they've like or deepmind they've like hired all these people to like do not ZK based verifiability like Scott Aronson and stuff uh for like proving that like some content was made by you know a model or not and I think like fundamentally Ezekiel is going to be the only way to do that I just don't think that all these like kind of half-assed Watermark Solutions are going to really work that's an interesting hot take I mean I I do I do want to see like how

people can reduce the trust in training specifically I mean it's not as as like I don't know as sexy of a problem I guess but if we can get to some situation where it's the same trust as The Trusted setup where we can have one honest participant and we can know on what data a model was trained I think that would be really cool yeah I guess like I still have a lot of confused into what the use cases of like verifiable you know imagenet predictions are you know like I don't know right like or not predictions I guess like classification is yeah what is what is the active use case here for like we have a model we like verify that the output is indeed

from that model what do we do with that so I I think this idea of like you know the value that people get from social networks you know if we try to like decompose that value into value they get from content generated by other humans content generated by uh purely algorithmic means and content generated by like a combination of the two like let's roughly speaking bucket into those three I think like the more scarce that the content that's actually generated by human gets the more people value that over time versus like the algorithmic content is going to be everywhere sure and being able to prove that you're not algorithmic content and or having the algorithmic content

forced to verify itself and prove that it is algorithmic will sort of be this thing that makes the the real content value go up right like it's it's like it's like the vinyl records right like everyone's like vinyl records are dead you know right but like ironically they make more money for a lot of record labels make more money from Vinyl Records than they do from any of their other digital uh forms of selling stuff because people buy as a merch and I sort of think content on the internet will have that will be the vinyl records where you know if you can identify that content was or something was made algorithmically uh and it's sort of like a standard that everyone can verify then suddenly your

single origin human created thing becomes just worth a lot more whoa what what are the other fair trade humans fair trade organic non-GMO human content or non-computer modified CMO maybe this is again this is all just my opinion like this you know obviously it's like I I don't know read ask some sci-fi author they probably have a much larger thesis than I do on this I'm not fully sure I understand like how how one would prove the non-provenance or the provenance of like a fake not being for my computer right like fundamentally that separation feels actually much more difficult to prove than not than not yeah I but but I would say networks can enforce that any algorithmic content

generated had to be has to post some provenance proof in order for it to use their API or something right I mean you could always like have these open source people create different version that doesn't do it so I don't know yeah just like repost it yeah for sure I I I'm definitely not saying that there's a foolproof way of doing it but I I do believe that there will be this like monetary premium yeah yeah in the same way that like art gets more valuable when someone commits suicide or they die uh are definitely way more when it's suicide versus just normal death I I kind of think this is going to end up being the same thing and like somehow yeah single origin human content might be inferior might like you know have not be like as precise or might not have

like as much you know descriptive desert data but first for some reason it will be worth more and it'll be like art I I just like it's like hard for me to imagine that not happening yeah yeah I I think I believe the the general gist I just don't know if ZK proofs is going to be the the way to do it that's that's where I'd ever but the proposals we see a lot of right now are like all these like statistical watermarking mechanisms oh yeah like and like those things all seem like fine having to run the modified version that doesn't need the proof is one thing but these like things that you can actually fool with like very simple adversarial models seem like not the you know we're just back to this whole like the you

know people in ml have this version of what they think like private ml is and like it half the time it always gets attacked and you know actually we had an episode with Florian who's a professor at eth about about exactly this phenomena which is like you know in machine learning there's kind of much less of the the notion of privacy so weak and these these watermarking things look exactly exactly the same so I'm quite nebulous on them I think all of those are just so that big companies can tell like Regulators like hey we checked the Box we try it but I think ZK is the only thing that will actually provide some actual guarantees not just some sort of like we added noise hope it you know doesn't look like a human what do you

think this year though like what do you think we could see in that way like in the zkml front do you think I mean I guess we could see new projects we're trying to do it do you think we'll be like actually hearing new use cases being proposed yeah I kind of Wonder like at least when I talk to other people they're like time frame wise we might be looking at seven years or something like it might not be a a two-year three-year type thing I think related to what Tyrone was saying like you you have this maybe middle grounds so for example what worldcoin is doing or what we talked about with uh Dan in in on epicenter or actually in our episode as

well and where you have signed inputs like either from the orb or from the cameras so that helps a bit alleviate the worries of adversarial in like scenarios so then you can offload or move all the detection models to run on the client side which is interesting because then you have privacy against the servers interesting and you don't worry as much about adversarial inputs but uh so that that could be an interesting use case that doesn't take too long to deploy maybe actually that that time frame was also talking about because as I learned through that interview with Lauren the

the difference between like uh inference and model training so like everything we're talking about right now I think is the inference side right it's using existing models but then it's the model training trying to do that in private would probably take a lot longer that that is effectively impossible yeah I'm still I'm effectively gonna just assume that's not gonna happen okay actually there are people pretty important people in the systems agree with you actually true I I mean I agree with you actually was this uh quite a bit but there was recently a paper that attempted to disagree with you I think I think I think like if you jointly optimize some type of like how big your model is versus how much privacy you

want type of thing maybe but training is also just like a dark art versus inference right inference is a very well defined algorithm like you know there's like it's like almost deterministic uh training involves like I do batch Norm on a random layer I like suddenly truncate a bunch of other things you know there's like so much Dark Art in that stuff that I I hesitate to even even if you did were able to prove that you could do it for one model it'll never scale to the way people like build models maybe if you save some seeds in Randomness that could make we could make some progress but it's I'm not sure Kobe I know you have to bounce early but thanks for those use cases thank you for having me and good to see

you all yes and uh excited for our next episodes yes coming up in the next few weeks right catch you later Kobe thanks Kobe so now we'll we'll continue without Kobe we're gonna continue with a couple use because I'm curious if you I think both of you could probably speak on this but I don't think we would have talked about this last year but it was the ZK Bridges like we did talk about it in 2022 but I know that that really kind of came into a four in the last few months do you see more things in 2023 around ZK Bridges I mean more meaning like the people who are working on it will deliver we'll deliver things yes uh more in the sense of like new algorithms maybe not I I feel like right now I feel CK bridging

feels like the type of thing where it's like we have enough of a design space and now it's about just like optimizing the code to actually run fast right it's like it's like proof of stake hit this same stride and like late 2018 or mid to late 2018 where it was like all the ideas are on the table there's not that much else you're going to do it's just like Implement them and then you have this like make them good a couple years of engineering it feels more like that than it feels like uh like there's some big unsolved mechanistic thing that is out there I don't know German what do you think I mean there's really I don't know like there's certainly some art to it but like for the most part it's kind of like you know we have these consensus things we're following right whatever it's

because this is real following we need to like verify them I'm sure there's like maybe some set of ways that you can make something slightly smaller slightly larger at the end of the day you're kind of just like doing the thing right like there's not like some like complicated difficult hard elliptic curves question in there I mean there might be but but like it's pretty unlikely right like for the most part it's like we it's now more an engineering problem than it is a research problem maybe it's the which is good which is good and a lot right that's right like like part of the 2017 boom stupidity was like everyone on their mom if they had chat GPT you know they wrote things that sounded like they came out of chat GPT for describing why their proof of stake mechanism is better and they had like no way of like proving

why or how or whatever and I think by mid-2018 it became a lot more clear there's like there's only a few wait a few things you can really do a few ways you can like directions you can like make some particular large changes in and then it was like the teams that had the most Capital just like went down those roads yeah I wonder do you see like the ZK VM zkevm in a similar State as Bridges like a lot of the ideas have been quite fleshed out and now it's about implementation and the sort of who's going to win is still kind of up for grabs like who implements fastest how like we don't actually have metrics on a lot of these things yet so you know because because the task is so much more

like complicated large in the space I do mean like large and like this weird you know one where like kind of doing arbitrary computation when we're kind of not uh there are probably a few more tricks to be played but I do think it looks much more like engineering than research still yeah um I think if there are Improvement like systematic improvements it'll probably come more from like better tooling uh for like ZK you know in terms of optimization in terms of what whatever any number of things then I think they will probably come from like you know really smart like individual optimizations so I I do I still see that still as more of an engineering artsy fartsy part of engineering because it

just requires some tricks but but still engineering then like you know what what is like pure research of like ah let's figure out this like General thing that has all these like you know nebulous questions about it yeah I mean arguably ZK evm has a bunch of open problems but they're not like theoretical problems about ZK they're much more just about like you know uh have you have you ever seen that uh that that Meme about like what modern software engineering is and it's like they take a bunch of plugs from different countries and then they stack them and until they all like inter interface correctly and they make this monstrosity it's sort of like that more than it is like oh like you know you know how do I make a new ZK mechanism I I kind of feel

like while there is a lot of stuff people are doing on Decay mechanisms um I think more of the actual like true research seems to be on the NPC and side if I'm giving you kind of my stylized view of it I I actually wonder if we'll see more breakthroughs there than in like actual ZK like there just seem to be some people who are really plugging away at fhe a little more after the last couple years because I feel like there was like a little lull and people were like pretty down on it and then move towards ZK and I kind of feel like I've met more people who seem to be suddenly uh thinking a lot more about fhe

uh fully homomorphic encryption um and so I'm not trying to say anything that's like some crazy thing like oh yeah we'll solve it by next year but like if I were to place like lottery ticket style bets on where you would have the research Innovation it's like in that Realm I think in terms of innovation in ZK what I see happening more and more is like use cases like for these tools like what we described earlier these experiments it's at the stage where people can actually do that and so it's true that like yes there are increa I mean we I think we've actually felt that since 2019 in 2019 they were like breakthroughs coming in and then in early 2020 it was like Planck comes out

and since then there have been a few Milestone breakthroughs but it definitely got it was like lots of papers being published lots of small interesting incremental incremental add-ons yeah but less of that like you know Paradigm shifting research coming out yeah I think that makes sense that's why my bet is actually that it will come in like these things that people are quite negative on but are like starting to switch a little bit on or so it seems like just in terms of big research breakthroughs yeah yeah yeah yeah I also think of like the frontier for fhc is quite a bit more open for these breakthroughs than like ZK like I feel you know maybe there's like another inflection point for ZK but

it does feel like we're like very quickly leveling off yeah yeah like the the low-hanging fruit unless someone comes up with some crazy new technique but just like opens up a big field that seems you know as time goes on more and more unlikely I think that's fair but I want to explore one use case that actually I think it might have been Guillermo I think this might have been the first time you came on the show I think we talked a little bit about this I I mean I think it was the private dexes oh like the idea of a private Dex what was what you needed for decks to be called private because there's like parts that can be made private in other parts that can't but then can you really keep certain things private if other information is available I do Wonder

like just checking back in on that where are we at with private dexes have we like has there been a standard decided on I mean I don't there's there's not that many groups doing it I still think it's pretty like yeah wild Westy I think there's some initial answers for sure which have interesting prop actually weirdly enough I guess maybe they describe it it's a bit of an open space still sure I mean that's the obvious way of describing it but within that there's like a big Spectrum where you trade off fundamentally right like kind of and and I don't know if you recall I think you're acknowledged in this paper for like inspiring it um like there exists this funny like

open space of like you know privacy can't really or when we say privacy we mean specifically like one cannot reconstruct individual trades from like just by like viewing public data as you know that's actually a surprisingly difficult thing to achieve right and that's kind of what we outline there um but that also means that there's kind of like always a fundamental trade-off between kind of how quickly things get executed and at what price they get executed at like trades I I mean and up like privacy right and there's we I think we now have some ideas for certain Solutions right in the sense of like like penumbra is one

example yeah yeah um where you you have a little bit of this trade-off between privacy and what what might call economic efficiency or whatever um but I don't think the trade-off has been fully explored um for example Panama use a very particular mechanism for how to kind of scramble together trade so to speak um and and it turns out it has kind of interesting properties yeah we did an interview we actually could link to that we did an interview with Henry where we talked a little bit about that particular model but I do Wonder like have you been following that space is there any other like are there unanswered questions there are models that maybe have been sort of proposed but not explored not implemented there are some most

people see for some reason like the hot thing within privacy turns out to be like I think people call like rfqs or whatever is that what it is yeah so it's like somehow like everyone thinks a private Dex is solved by like making a private like RFQ what does that stand for request for quote so it basically just means like I say I want to trade five Anna coins for Guillermo coins and I say okay here's here's how much I want what's the price then you get you you know the mechanism goes on queries people uh who are willing to take the other side of that and then gives you the minimum of their thing so the places where you could make that private or are

that the you know and sort of one bad thing that might happen is like say you say you want to buy 10 of the Anna coin Supply well if I tell the mechanism that and then it goes and asks all the people who want to sell Guillermo coin they may collude and say like wow Anna's dumb she's like selling 10 percent of this like let's let's collude to give her a horrible price right that's that's like one one mechanism that so the the Notions of privacy you need there are can you submit your trade size privately can is that and but can it be done in such a way that the people who are then providing you know bids to you uh can get enough information such that they can give an accurate price that that

makes sense um and in some sense you have to have like privacy on both sides but also some amount of information that's shared but it's very like you can analyze each of these components separately which is why I think people are you know people from the Privacy lens want to do it it's a little bit more like over-the-counter trading though than it is like like training against an amm it's it doesn't feel like continuous trading right it's like there's many interactions like I have to go you have to go give the the amount you want then it has to go message everyone who's willing to be a liquidity provider then take those compute some function of that return to you then you say you execute right whereas unisoft it's like a one click one message type of thing right so this

communication complexity aspect of these is is actually quite important and I think I haven't seen anyone on the Privacy side who's actually focused on the fact that you're reducing the quality of trading by forcing people to have many different rounds of communication and like what does that cost you right for some reason like that's been that specific mechanism has been what's been ex like I've seen some amount of exploration actually even that not that much but let's say claimed exploration um it's actually shockingly difficult to understand but kind of on the deck side there really hasn't been that much more I haven't really seen that much personally I don't know exactly why but I mean it's

fine I wonder well I mean tornado happened and it might have maybe made some people a little bit more cautious to explore that right now yeah I don't know it's just kind of a funny thing because it's like it's a cool open problem I mean yeah you know you maybe if you think that like penumbra is the end state of private decentralized exchanges then in that case surely like that you know go work for a number or something instead of like making your own but I I there is an open question of whether there are more interesting mechanisms I think there are I mean the place I think that's in between these two is sort of like mechanisms that involve sort of like many auctions that are involved so like you know actually I'm writing this kind of short

paper on this right now but I was actually trying to study this like uh gradual Dutch auction thing that's like oh this the whatever I mean art gobblers gross disgusting whatever that I could never never imagined liking the the art or game like it's kind of gross but I think the the the mechanism is actually kind of interesting if you try to like understand when it's sort of incentive compatible or not the current version uh that you know the one that our gobblers uses and and sort of like Dan at almid is technically not incentive compatible but there's a way to to basically modify it and like I think once this the space of things that are like continuous

repeated auctions that you can join and leave whenever you want and there's sort of some some like Supply it's sort of like a middle ground between the pure RFQ which is like lots of back and forth to do anything versus like the uniswap like hey there's just like continuous Trading and I think that space is actually a place where you can make things probably a lot more private but but I think you first need to actually flesh out the design space of that like here are mechanisms that could work not privately here's how they work like original exponential gradual Dutch auction is like right idea sort of but like wrong parametrization and wrong model for like the curve it's sort of like it's as if I

did a uniswap curve that was linear when unisop started and it didn't didn't really like it wasn't able to take off I kind of think that GDA has that problem right now but um yeah systematically setting that I think will lead to some private routes and like there's some sense in which you know the real North Star for private deck should be that there should be some mechanism where trading liquid tokens and nfts should be the same you just like parametrize it differently for both in some way and you can kind of interpolate between the two so that you just it's kind of like one type of trading vehicle that lets you do everything and right now we you see like The Vespers of that right it's like uniswap bought that aggregator and like

for their nft exchange just like mainly in aggregation mechanism but there's some clear thing where there's like a design space like prior to making it private that unifies Trading these like non-fungible type of things with liquid tokens and then you try to make that thing private so that that's sort of if I were to give you the two-year vision of this that would be what I would say is like missing and you know I think part of it is like people aren't that interested in building those things when there's not much trading volume uh so like there's certainly that aspect that you can't ignore but maybe you know like uniswap like someone will in the bear Market be bored and interested and I think like that's more

likely the the thing to look out for but again I think the design space needs to be fleshed out like like I said I I think there is some sense in which the North Star shouldn't just be private decks or like private RFQ it should be like I want to trade nfts and liquid tokens almost in the same way and that thing if it works should be able to be made private hmm but that might be a lofty goal right like yeah yeah you have to you have to have like kind of the hot spot to believe that that thing can be built and whatever sounds actually a little bit like a noma's pitch but actually I want to know in the larger defy ecosystem are there any other places where ZK is being Incorporated even like maybe on the Mev

front like is there any sort of place that you do see some sort of incorporation that we haven't seen yet or you could see I don't know actually I don't I haven't seen anything so usually what happens specifically with an Mev right it's like ZK is going to use for two things it's used for privacy yeah nicer proving the correct execution of something in the case of Meb there's often relatively succinct ways of proving the correct execution of or the correct solution or without actually like requiring the full Machinery of ZK so for the most part within Mev the like real so to speak like you know use of ZK

is actually more as a privacy tool not always perhaps I mean there might be exceptions to this rule but for the most part it's used as a privacy tool rather than as like us to sync proof to a correct execution tool or whatever you want to call it right um which is which is distinguished from ZK almost everywhere else where it uses both roughly equal if not actually more in the succinct side than than the Privacy side so I mean one place where it's it has already been at least proposed is in the voting part so maybe it won't be in the kind of protocol level like the software level of the actual mechanism but rather in the voting or governance side of things with voting using something like CLR fund or Macy as private voting but also this

idea of like Anonymous multi-cigs you know you heard about Constitution Dow too I heard about it I actually have no idea what it's uh you know new and improved version is well I don't actually I haven't tracked it so I don't know where it's at but I do know that like Dan had done work on creating private dows the idea here would be like specifically in the case of an auction if you are bidding against other people and you can see exactly how much they have this is like maybe in a real world auction it's really hard to sort of like win your auction if yours is visible it's kind of puts you at a disadvantage and this in this way you could actually create sort of a a private treasury amount when participating in an auction

interesting and I don't know if this fully connects to defy but I know like voting in general and doing that privately might help um but has that been explored at all like has there been any kind of major projects that have even like worried about it or discussed any sort of privacy in the voting or do you almost feel like it's it's antithetical because like you want reputation on the line when you're in those in those spaces yeah it's sort of both uh part of it is like the existing ones want the latter um there were certainly some very bad actors of late 2021 to early 2022 voting wise I mean the easiest example was was Wonderland um but there were a ton of other like

voting malfeasance types of things also the ve model kind of like distorts that and we've seen some crazy things like the the thing that happened to balancer a few months a month ago so I would say like people focus way more on the voting mechanic slash payment side so far there's a huge disconnect between like real projects that are live and ZK intern projects like at CRX Park and stuff where there's like tons of these like Hey how do you do private downloadings uh and I think part of it is like it's just not very robust right now and also the voting mechanisms like you need some form of credibility that that needs to also exist

um and I actually dare I mean credibility in sort of like a technical sense which is you know if the entire Dow was completely private and you're voting and you know this like whatever I I forget what Phil Diane likes to call it dark Dows but I I I don't really like the I I think like privacy shouldn't be connotated as light or dark it's just a its own thing but uh you know hey like you'll never know where where the money is going to be where it's going how things are voted on whatever so like can you actually have credibility can you have any notion that like people aren't cheating in that system so yeah so there's definitely that in the Practical side I think that's what's keeping it from reality but I think like if there were some set of very good

queries where you could prove some state of all the voters in aggregate that gives you confidence that it wasn't manipulated or like some some type of thing like some aggregate statistic can be monitored that's public you might get to that but yeah there just hasn't been that much I think like there's this huge divide in that the like people on the ZK side are like oh yeah isn't it obvious why wouldn't you use this but they like completely ignore the sort of like socio-political Dynamic aspects and so that that kind of I feel like is why they're separated yeah this constitutional two thing I think is like probably the only thing that's trying I I haven't really looked at that hard I saw some people Shilling in on Twitter but didn't yeah I I try to take I tried to take an actual vacation and not read

any what's funny about this is I remember you uh mentioning like Constitution Dao 1.0 was like people you know like Dows learning about adverse election and real auctions right and it's like and I actually remember you saying something like um privacy tools are probably going to be more useful for Dao's at the beginning because they're gonna be expensive to use and kind of difficult annoying than they are for like the average Joe or whatever because of this fact right right but the the average Dow participant is an average Joe at this point right they don't know exactly yeah so there's sort of this like very weird thing of like the Dows are democratic but only Democratic for people who understand how to use wallets and block

Explorer as well of course yeah yeah for sure which which isn't necessarily like a bad thing I mean anyone can go learn how to do that but it's not going to be like everyone right right yeah I mean I think the other things that are are kind of like interesting I mean the thing I'm still focused on and and but like again this is a little bit like this idea of like the how do you do nft trading and normal trading all in the same way nft Mev auctions also like certainly I I still stand by my claim last year that they will be the number one consumer or producer of value using ZK at some point and when I say ZK there I'm using it in the Venture investor sense of NPCs fhe ZK

uh but I I am purposely ignoring STX because I I don't think long-term sgx will will survive in that so I think there are a few more categories in the ZK space that are emerging that we should mention here one is like just to keep an eye on ZK gaming dark force came out I think in 2019 and obviously blazed a trail but I know that there's still been a lot of experimentation around this and I'm hoping that we start to see like another breakthrough with CK gaming another space to keep an eye on would be ZK social so this is things like semaphore private messaging or trying to rebuild any sort of social network with CK and some sort of privacy um sort of close in proximity to both of

those topics would be zkid this has been proposed for a while but I actually think this year we're going to see it being used a lot more I know that there's a few really key projects like Iden 3 has been working on this for a really long time there's also a company called sismo zkv is an investor there sismo like every time I see one of their presentations I kind of like understand better how powerful this can be like I'm going to take a step back into like what id is usually so if you think about it like say you're trying to get a passport or you're trying to get some sort of identity card usually what you have to do is fill out a form with a ton of information some of that will be used on the card some of it is actually used by this third-party

like governmental body to prove that you are who you say you are um but once that's proven it's sort of like it's made private actually again it's not shared further on the card or on the passport what's on the passport is just your public facing version and I think when it comes to on-chain Identity stuff right now at least without zkps it's extremely transparent so it's like everything you do that adds reputation it's sort of visible and say you want to issue a PO app or you want to offer like oh you participated in our airdrop or you did some action you're you're still kind of linking the action with the address it's going to get the reward or

certificate or stamp or poapp or token or whatever and so it's extremely public what these new projects are offering is a way to kind of cut that link so you can actually prove that you've done something so like build reputation offer all those documents have your private data have it somehow kind of checked but it's not checked by a third party I'll use the example of sismo where what they're actually doing is like you can prove for example that you like you have a Twitter account that's on a certain list or you have like participated in some sort of protocol you've done some sort of trade

you've added liquidity you've taken a loan you've done some sort of action and you can then kind of choose to create an attestation so this you think is something that could like show reputation it kind of proves your humanness maybe your your participation in a certain Community but you can actually create it from one location but send that attestation or badge or in their case it's like a one of those nfts that can't be moved uh it's whole bound I love that term yeah you basically can put that into another address that you control and then use that to sign things so it's like you can yeah it's a really cool idea and

um I think with this tool or with even the concept of such a tool I think there's a lot of very interesting use cases that could be created around IDs group membership reputation and yeah I think it I think it sort of takes it up a level I think it's a really cool case for you for ZK definitely not something I feel very well versed in and something I think I would love to explore more in future episodes so are there any other use cases you think we've missed on this episode I mean I think the uh the real question is like in this kind of like prolonged bear market like what the new types of assets will be that are needed in the next year because

like I feel like each year seems to be punctuated by certain types of assets that are either created or destroyed 2018 2019 is like the uniswap lp share or C tokens or a tokens 2020 was probably like vaults like you're involved like the notion of like those types of assets strategies yeah strategies a 2021 was probably just later ones I I don't even know what what nft and other types of nfts 15 11 55.

stuff like that 2022 who the hell was was the lack of claim for Destruction yeah the destruction of claims and all and all Associated benefits uh it was the stress test so 2023 what's your what what type of asset do you predict like and I know Anna's default prediction is private asset but I I don't know I don't know I don't know this is the year of private assets like no I think my my current is like ZK use cases but I don't know what the tool there is like what's yeah but like like a one way of rephrasing that question is like what asset is important like what will it because like that will actually end up kind of dictating what the use case that gets adopted is if you work backwards so

it's like what does that asset look like right like the 2020 Innovation was like you can have like actively managed strategies right 2019 Innovation was like passive everything was passive 2021 was maybe like make your own non-security security 22 was Bridges at Bridge assets blowing up actually I I actually would say synthetic claims across chains not not being what they wrapped right like but the bridge asset in my mind stands out like the bridged whether it's synthetic or native I I feel like anytime anyone tells me these like native bridged assets they never really are when you

read the contracts because like they have some callback provision or like you have to put up some collateral so you're really holding a portfolio and something that's like uh it's not really native in the sense of like if I went from eat to Seoul I put an eth I get out soul I never have to think and then when I go backwards I get Ethan I never you know I never had like a like a centralized exchange you don't think about that right but in bridges you still have to spend all this time I I think the the the native asset Bridge is a bit of a LARP so far and at least the code the contracts don't look like that okay so 2023 let's say let's say there's a new asset type maybe it's coming from ZK what does it look like does it look like an nft does it look

like a strategy does it look like a passive thing like how would you what do you think that would look like yeah I really don't know how to answer this I'm so not thinking I like I don't have any sense for an asset at all can I just I'm just going to say the the thing I I want and the thing I think needs to exist for that to exist so the thing I'd like to see are ever more ZK use cases kind of the creation of more black box easy to use out of the box tools some sort of platform where people can actually build and deploy ZK things in Z like in environments which are really really catered to that I know that there's a few projects aiming for that because really what I want to see by the end of the year is just a ton of

really cool experiments and I know this does not answer your question where you're really looking for like a ERC something something something uh some sort of token standard an asset standard I don't have that I don't like I think it's really hard to predict what that looks like to me this is easier than predicting black swans which was one of your original suggested topics okay well what's yours do you have a good one I think mine is like if there is some data structure that exists that allows you to simultaneously store private data but like make provide some summary statistics of it and you can like own some notion of like a fraction of that

um where like the the private assets are pulled together but no individual like can can control them uniformly but the public statistics are how people like have an understanding of what's happening and you can own a share of that so like if in a world where you have you could in a this non-existent world where you could have had like a totally private unisoft LP share like in theory that meets those criteria right where it's like right I have my liquidity people don't know it's my liquidy but I also know some public thing I know the price and I know you know the price impact um but obviously you know that has this impossibility theorem so okay let's now try to say like what is something like

that where you can pull together assets privately but there's some public transparency around the aggregation of those assets and you own a Frac you can own fractions or trade fractions right and then and that's it's not gonna like I said it's not gonna look like a dexl future it's going to be something like that and whatever that is I think the first ZK asset will look like that first like well used one could this sort of play into that concept of zkid then where you do attestations privately to things existing so there you'd be able to create like in a test I mean it already exists where they have an attestation badge that can be publicly shared and it reflects something private I know this is like I mean this is usually used for

events and stuff like that yeah it's similar here I guess is the point but here you have like more data so one one example is they can have an address station that indeed the balance you have is greater than like a million or whatever or whatever you know you the the amount of token a let's say we're talking about like a private LP share right like you can attest to like individual elements of the um chair right let's say it's like you have like 10 coins in this LLP shirt for some reason or another right you can attest to the fact that like you you know the lp share and coin three has like this much without revealing anything else for the the remaining parts I mean that's one example right uh you could also Imagine like um if you're collateralizing like a duck position using this thing right you

could say like based on the current price given by whatever exchange the total worth of this share is X but you actually don't know how how much individual assets within a share are actually worth that's one example of course turn to sign about a slightly more General data structure than this specific case that we can include maybe other things but but the point is you can prove kind of like economic or non-economic just like generals this is what I think he means by summary like statements about the claim yeah right so you can make claims about like this thing you don't know what it is some like opaque object but I can guarantee that it's worth is like whatever yeah not just not just worth it can be attestations about the content right like any attestation that's like

but my point is like you know one interesting thing if I take the asset of the year of 2020. my these are all my of the years so obviously I'm not everyone else can kind of tell me go off if they want but um but you know if I take the Vault right the Vault sort of was created of necessity because you're a D5 summer and there's tons of farming and you had to manage these portfolios it was way easier to manage them in the smart contract than to do it individually in wallets and then it became a standard over time like the erc4626 standard uh and obviously in Solana they have an equivalent so like I realistically the Ethan Solana ones are the only like true

Vault standards I think other networks have them but they're not like extremely standardized of like what it means to be a vault but the existence of a vault was like one of the best developer tools ever it made it super easy and you can argue that like uniswap V3 learned from that like the the way it stores things and so there's a sense in which maybe in ZK land a way to actually get adoption is to invert that thing where you actually make a standard like this that's like the token standard of like how to combine assets and like make attest stations and then have those attestations be tied to like the minimum Compass some some functions of the composition economically without revealing a lot and if that was an easy

standard to use then you could start making these like ZK assets right and then I haven't seen anyone like really try to standard because like ZK people Define making standards unsexy no there's no way of getting around that like I I'm not that type of I don't like the idea of like writing specs for standards it sounds boring right like but but in every programming and open source Community there's always like some fraction of the community that is very much like no we must like only write like this type of module in this way in this language and here's a spec and if you don't agree get out no pull requests and like there there's like they're the equivalent quote like soup Nazis of every open source Community yep and uh I think like ZK could use a

little bit of like someone like that whipping this type of asset into shape I wanna I wanna explore what you just said quickly this this idea of what needs to be underneath do you think there's any work that's come from like the bridge work the roll-up work like basically doing the bridge bridges that have to make this like the bridges implicitly aren't making this and so the question is yes yes exactly and so the question is can you standardize this so that it can be used in a lot of environments because I feel like that would make it a lot easier for like a D5 developer who doesn't want to learn anything on ZK but wants to just be able to like get some like values from this blob that's kept private I like this that's going that's my prediction for acid of this year cool

that's a cool one actually I mean it's a little bit General that it feels almost like we are just kind of rehashing with ZK proof is but but I think the standard for D5 development the way you hold a bridged asset across a bridge if it was Private not just versus succinctness would basically look like this right you would be like there's some collateral that's private on the remote side there's some attestations that that collateral without leaking its value is locked correctly and that you have balances here of this that's an account tied to that that's right yeah but but like one could imagine making a more general standard that isn't here is like generic blob here is generic computation that actually is useful and easy to develop for we have three minutes gear mode can you

give a quick prediction in in a short oh man moment uh can I give a quick prediction for what kind of asset is going to be like the asset I I've been I've been a little stuck on uh on a you know kind of me view lately and and a few other things that are similar to fair but my suspicion is things that are gonna happen is one of the things that will happen is uh there's gonna be weird future claims um for kind of like inter chain uh Meb and entertain Arbitrage and these kinds of things like these like weird derivatives where essentially what you're doing is you you bed now you bid now for for a for an expected future slot at some point and I think that's actually going to be

like the the asset that defines 20 23 at least I mean that's probably honestly a more realistic prediction uh in the sense that like the zk1 needs like all Disney case stuff to work so it might be like a year or so but uh yeah it's it's that's a very good one in in one other respect which is that like almost every Mev on every chain including eth like flashbots is moving the direction of having you know this this uh there's a word for this that like functional programming people like and I kind of like the the word for this like there needs to be some version of this but there's a thing called a thunk uh and a thunk is a way of like wrapping deferred computation that you can

transfer around so it's like let's say I have some deferred computation that's like find the nth Fibonacci number and uh I give you I give you a little box and uh that's like hey this thing can compute the answer Fibonacci number I've computed the first five uh but like you know you have to put in some like gas to get the sixth one out so the idea of the computation exists but it hasn't been paid for yet and it's a very it's a very natural way of thinking about these kind of like Mev future type of things but yeah these cross chain like uh Futures and Promises definitely inevitably will have to somehow be like acidized I mean the the most hyped asset right now is like staking derivatives but I kind of agree that these like Mev

derivatives or like future rights derivatives like land right though those are like clearly going to be yeah those people already have made them they just haven't like standardized them maybe but I they haven't gone into a public Consciousness in the same way that like any of the other things well when I say public I mean like very esoteric Niche and made loving yeah yeah uh degenerates uh world but but actually do you think here's here's a question philosophically do you think that those will be standardized or do you think there's actually excess value to not standardizing them because like each pair wants I I think I mean certainly at some point they'll be standardized while you're doing it like uh I think

there will be a right way of doing like these like futures um but these these partial Futures whatever with like you have like additional um you know things that you need to do to like stepped through the next point of the state machine that being said I think currently there will be some internal strife as to you know should we not standardize it because that means that there's other people will start yeah we can break our liquidity yeah exactly also we could we can break it in whatever way we want like you know in the next iteration if someone does something and be like oh we added this like new epicycle I like that yeah I mean that's a very good question that I think next year we should revisit is like did the bear Market cause people like it did with l1s in 2018 2019 to all

work together a bit right or will it cause people to be like no no no I don't want you to steal my liquidity I'm making my own sandwich it does both right I think but yeah we should check in it's good that's sort of wraps up our look across sort of ideas and use cases for ZK a little bit of a look forward uh how are you feeling about 2023 are you excited hell yeah well hopefully I don't know I think I'm excited okay true [Music] um I it was good it was good to take a vacation after many years uh and uh your outlook maybe I don't know about Rosier but you know I will say during my vacation I went to Switzerland and I went to Zug and don't worry I'm

not because I was like starting this stiff tongue or something but I had relatives there uh uh But like everyone in Switzerland is still positive on crypto like all of them were just like I was like I was kind of shocked but like obviously there there are you know Switzerland is the wrong place in some ways I'm it's a very biased sample this is a country that like had Bitcoin ATMs on sub on trains in 2015 right but there's still nothing benefited that's the thing it's like no minus yeah yeah but I haven't I I even then they're still pretty I was surprised by how positive people were they were just like yeah it's good to have the frauds out early I was like okay

that's one way of looking at it cool all right well thanks to both of you for coming on thank you Anna thanks thanks to Kobe who had to leave early thanks to the CK podcast crew Tanya Rachel Henrik Adam and tour listeners thanks for listening [Music]