Zcash-BlockchainAlliance-slides.pdf (792.7 KB)
A couple of days ago I gave a 15-minute “webinar” presentation about Zcash to some of the law enforcement and regulatory agencies from the Blockchain Alliance. In attendance were people from DEA, FTC, IRS, Treasury, FinCEN, SEC, California Highway Patrol, and a few more agencies, both USA and foreign, as well as some other companies who are, like the Zcash Co, part of the Blockchain Alliance (http://www.blockchainalliance.org/).
The presentation was pretty high-level — 15 minutes is not long! It focused on the basic facts about the tech of combining encryption with blockchain, plus a few slides about my speculations about the impact of technologies like these on the practice of regulation and investigation.
The questions after my presentation were interesting. One of them that I remember was “Who do we send the subpoena to when doing an investigation?”. The answer was something like “Whatever company — like an exchange — is privy to the details of the transactions you are investigating.”. Another question was something like “Does the Zcash company have access to the records so that we can request them during an investigation?”. The answer to that one was “No, the company doesn’t have access to any such data. We’re just the makers of some science papers and some open source software. Zcash is an open source project, like Bitcoin.”. The third question was something like “How would we decrypt or otherwise get access to records during an investigation?”. The answer was “You’d have to subpoena a company, like an exchange, that was privy to those records, or gain access to a device used by a person who was privy to those records.”.
Here are my slides. They are pretty bare bones. Below I’ll paste in the source code for building these slides — the comments in the source code were my notes-to-self about things to remember to say. I may or may not have remembered to say those things during my actual talk.
(C.f. Gavin will visit the CIA)
… Zcash slides file, created by
hieroglyph-quickstart on Sat Nov 8 23:23:17 2014.
Zcash
zooko@z.cash
… image:: /_static/Z-yellow.orange-logo.png
:width: 4cm
Zooko Wilcox, Founder and CEO
Bitcoin is HTTP for money; Zcash is HTTPS
background / history
-
team of scientists
- Johns Hopkins, MIT, Berkeley, Tel Aviv U., Technion
-
Zcash Electric Coin Company
… We’re developing enterprise products for the financial industry.
… We’ve deployed an open source cryptocurrency.
science
- encryption
… Encrypt the data! Then you can selectively disclose the decryption key to authorized parties while concealing the data from unauthorized parties.
… Why didn’t Satoshi do that in the first place? It prevents validity-checking.
- zero-knowledge proofs
tech 1/4
… image:: /_static/high-level-txn_v3.svg
:width: 70%
… mixture of transparent and private transactions
… transparent addresses vs. shielded addresses
tech 2/4
-
selective disclosure
-
per-transaction
-
sender starts with the decryption key
… latent in the protocol but not yet exposed in the API
selective disclosure example
… image:: /_static/selective-disclosure-financial.png
:width: 100%
… selective disclosure example 2
… ==============================
…
… … image:: /_static/selective-disclosure-medical.png
tech 3/4
- encrypted memo field
… useful for the Travel Rule!
… image:: /_static/standard-cheque.svg
tech 4/4
-
the “blockchain properties”: canonical and append-only
-
the “encryption properties”: confidential and selectively disclosable
implications 1/5
- You tell me!
implications 2/5
-
some things stay the same:
-
FinCEN’s approach to AML regulation
-
a lot of common investigatory techniques
-
implications 3/5
-
you lose some things:
-
clustering / tainting / blacklisting a la Chainalysis & Elliptic
-
maybe
-
implications 4/5
-
you gain some things:
- privileged access to live data in the canonical blockchain
implications 5/5
- the big question: large-scale commercial deployment?
thank you!
Thank you! Get in touch!
… QUESTIONS:
… what am I missing in “implications”?
… how could you use technology like this in your work?
zooko@z.cash
… image:: /_static/Z-yellow.orange-logo.png
:width: 4cm
Bitcoin is HTTP for money; Zcash is HTTPS
… toctree::
:maxdepth: 2
… to build this from source, run “make slides”; requires Sphinx and Hieroglyph; sudo pip install hieroglyph