JPMorgan Introduces New Privacy Feature For Ethereum Transactions

Blockchain, Innovation, News | May 29, 2019 By:

JPMorgan Chase’s blockchain team has developed a new privacy feature that boost the security of ethereum-based payment systems.

The team has reportedly built an extension to the Zether protocol, a privacy protocol that’s been developed and proposed for account-based smart contract cryptocurrencies like ether, ERC20 tokens, and Stellar lumens. Using zero-knowledge proofs (ZKPs), Zether facilitates the concealing of transaction values via encryption, so the payments mechanism could allow top cryptocurrencies not presently centered around privacy to become de facto privacy coins.

Oli Harris, JPMorgan Chase’s head of Quorum and crypto-assets strategy, said in a statement that basic Zether allows concealing the account balances and the transfer amounts, not the participants’ identities. Harris added that the new privacy feauture solved that.

“In our implementation, we provide a proof protocol for the anonymous extension in which the sender may hide herself and the transactions recipients in a larger group of parties,” Harris said.

ZKP has many weaknesses, one of which is slow performance. However, Harris said that they did not face such issue with Zether, adding that “there is not an impact on performance, it’s more just an additional functionality that would build in.”

“Of course, we are still very early days in terms of doing any detailed testing around performance and scalability in production networks.”

The new privacy-oriented solution will be open-sourced and integrated to the bank’s proprietary permissioned Quorum blockchain, which was developed using the ethereum protocol.

“When we think about the community building on top of Quorum,” said Harris. “if anyone is looking to get an efficient trustless mechanism for trustless and anonymous payments in a consortium then that’s when it’s relevant. That’s why we wanted to open-source it back to the community so anyone can build on it further and continue enhancing it and potentially put it into their use cases as needed.”