In a new development, Ernest and Young (EY), the world’s renowned Audit and Accounting firm has released an update to their Nightfall open source and public domain tools that would vastly improve transaction efficiency and privacy of Ethereum transactions, lowering the cost of each to $0.24, down from $100. This announcement comes a few days before the decisive Istanbul hard fork that will also boost the network’s security, paving way for a scalable, secure and efficient Ethereum 2.0, Serenity.
The Cost of a Private Transaction Will Drop To $0.24
The update enables the audit firm’s first version of transaction batching that will inadvertently allow 20 ZK Proof transactions to be processed at once. This not only facilitates cheap transactions but drastically improves efficiency.
For every smart contract deployed, “Gas,” denominated in ETH, must be expended. The update represents a 400X increase in efficiency over the first prototype released over a year ago, meaning that for a single private transaction, a user will pay $0.24, an improvement highly welcomed by businesses.
Of Nightfall and Enterprise Participation
Although the prices of Ethereum’s native currency, ETH, are depressed, trading below the psychological $200 mark, many enterprises continue to work and deploy applications on the platform.
Of the many, EY is one. Others include JP Morgan and Chase, which has derived a new private chain, Quorum, of the open source Ethereum code. All the same, ETH prices continue to consolidate despite the network growing from strength to strength.
Notably, the update is just eight months after the audit firm announced Nightfall, an experimental solution that “integrates a set of smart contracts and microservices, and the ZoKrates zk-snark toolkit, to enable standard ERC-20 and ERC-721 tokens to be transacted on the Ethereum blockchain with complete privacy.”
ZK Snarks Proposed by Vitalik
Zero knowledge (zk) proof is a cryptographic method where users can prove who they are without revealing their true identities.
An iteration of this version, ZK Snarks, had been recommended by Vitalik Buterin, the founder of Ethereum, as a means of scaling the network without incorporating off-chain solutions.
And there are layer 2's without data availability tradeoffs or liveness requirements, eg. tx mass-validation via ZK-SNARKs can reduce costs to < 1000 gas per tx if done well. That's ~500 tx/sec on-chain with all the security guarantees of on-chain.
— vitalik.eth (@VitalikButerin) September 22, 2018
Through ZK Snarks, Vitalik said, the network can process up-to 500 TPS.
“We can actually scale asset transfer transactions on Ethereum by a huge amount, without using layer 2s that introduce liveness assumptions (e.g. channels, plasma), by using zk-SNARKs to mass-validate transactions. Anyone can be a relayer; there is no assumption of even an untrusted special ‘operator’ existing.”