Confidential transactions are transactions that hide the amount that is transferred in the transaction while making sure that the transaction remains valid.
Why would you want confidential transactions? Should all the data and transactions on the blockchain be publicly readable?
This is not the case at all, data on the blockchain should be publicly verifiable, but that does not mean the data has to be publicly readable.
Just imagine a company paying out salary to its employees in VET. Without confidential transactions, this would mean that everyone could see how much each employee earns.
Another use-case is in business-to-business activities. Imagine you and a competitor both buy goods from the same supplier using VET, would you like your competitor to be able to find out how much you paid?
As you can see from the examples above, allowing Confidential transactions will make many more use cases possible. Any chain implementing confidential transactions will make it more interesting for enterprises.
This one of the reasons one of the big four auditing firm’s EY is currently working on project Nightfall, allowing Confidential Transactions on the Ethereum blockchain.
Bulletproofs – a protocol for Confidential transactions
Bulletproofs is a protocol designed to enable efficient confidential transactions in blockchain technology.
If you are interested in all the details, you can read the Bulletproofs whitepaper here.
One of the authors of the Bulletproofs protocol is Dan Boneh, who was also a speaker during the VeChain Summit where he talked about Bulletproofs. You can rewatch the presentation by Dr. Dan Boneh during the VeChain Summit 2019 here on youtube.
Confidential transactions coming to VeChainThor?
Dan Boneh didn’t announce that Bulletproofs integration would come to the VeChainThor blockchain during the Summit. But his speech got many community members wondering if this was something the Foundation has been working on behind the scene. Why else would the Foundation invite him to speak during the Summit?
When asked the following question by community member Ede in the dutch telegram channel “Dr. Dan Boneh was speaking about bulletproof at the summit. Will it be implemented in the future in any context ?“, Sunny Lu, CEO of VeChain, replied that they are indeed working on this:
We have been working on that part (implementing bulletproof) for a while. – Sunny Lu, May 11th
What do you think about confidential transactions? Is this another major feature the Foundation will implement to make sure the VeChainThor blockchain remains the go-to chain for enterprises?