The team behind Zoracles has released the code for a proof of concept that is applicable to one of the world’s largest financial markets. According to most analysts, the global derivatives market is often estimated at $1.2 quadrillion. Future contracts can be created for nearly any type of asset including equities, bonds and commodities.
Given the ability of smart contracts to streamline and aggregate financial agreements, it appears this is an attractive opportunity for the project to pursue.
Zoracles’ mission is to provide confidential DeFi data to smart contracts. The team is enabling private transactions using innovative zero-knowledge proofs to create anonymity for both parties.
These proofs are verified on a decentralized network. Presently, the team is focused on the Ethereum blockchain, but their technology can be applied and customized to any smart contract platform. A developer representative for Zoracles explained this structure as “Snarks as a Service.”
Zk-Snarks is the technology powering Zcash but Zoracles use case is much different. The developers intend to build Snarks to power decentralized financial applications (DeFi).
The work by Zoracles to create a proof of concept for the derivatives market can be reviewed in the team’s Github. It appears to be a very simple, yet powerful program that can be applied to any futures contract. The program is pulling data that is signed from exchanges such as Coinbase and then creating a zero-knowledge proof for smart contracts to verify before executing based on the agreed price parameters.
The ability to have global derivatives run entirely on a blockchain is a tremendous opportunity for any smart contract platform. The size of the future contracts market is routinely quoted above $1 quadrillion. The Zoracles team proof of concept is a first step to developing a robust solution that a decentralized application can utilize for confidential price data.
Enterprises that are moving billions of dollars around the world demand privacy for their clients. While other oracles have focused on connectivity, Zoracles has uniquely positioned their solution as privacy-first. This focus had led to an expertise in building Snarks that enterprises can depend upon to secure their decentralized transactions. The privacy guarantees with zk-Snarks is industry-leading and often on the cutting-edge of cryptography.
Zoracles has reduced their development time and speed to market leveraging a platform called Zokrates. This allows the team to focus on more high-level use cases and building partnerships to support enterprise businesses instead of the lower level building blocks of zero-knowledge proofs such as circuit design.
The team also highlighted a push into obscuring the sources of data using VRFs. A verifiable random function (VRF) is pseudo-random function that provides publically verifiable proofs in the accuracy of its outputs. The exploration and application of a random oracle model is synergistic with the team’s work in ZKPs (zero-knowledge proofs) and serves as an important extension of the privacy guarantees provided by the Zoracles protocol.
Data sources are often transparent in decentralized oracle networks leaving them vulnerable to man-in-the-middle attacks and price manipulation by actors looking to influence the smart contract execution mechanism. Zoracles’ approach to randomize API endpoints using VRF is a first in the oracle market and a promising step in providing an end-to-end solution for DeFi protocols that will require confidentiality.
Enterprises and entrepreneurs looking to leverage Zoracles’ next-generation oracle technology can engage with the community and developers to initiate a “Snarks as a Service” request by contacting the team on Twitter or Discord.
Zoracles partners with DeFi projects using zero-knowledge proofs to provide confidential data to smart contracts. Their end-to-end solution entails VRFs to provide additional security measures for their “Snarks as a Service.” Learn more by visiting Zoracles website.
Zoracles – https://zoracles.com
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