Pushing Bitcoin to become more scalable with zero-knowledge proofs

Cointelegraph Research explains EC-STARK technology and what it means for the cryptocurrency market.

For all the good Bitcoin brings to the table, it also has a commonly accepted scalability problem. Bitcoin can only process a limited number of transactions per block and, as of August 17, 2022, can handle around five transactions per second, which is low compared to most other blockchains. The limiting factor in scalability is Bitcoin's cryptographic algorithm.

The Elliptic Curve Digital Signature Algorithm (ECDSA) is the essential cryptographic algorithm that powers Bitcoin and ensures that only the rightful owner can access and manage their funds. Currently, verification of ECDSA, a Bitcoin signature for transacting and sending Bitcoin (BTC), is not efficient and limits the scalability of the Bitcoin blockchain. One potential solution is to use Zero-Knowledge Proof (ZKP) technology, allowing for higher degrees of privacy and security.

A recent Starkware paper presents the method to efficiently verify ECDSA from the STARK ecosystem, potentially solving the blockchain trilemma for Bitcoin - i.e. simultaneously achieving scalability, security and decentralization.

A ZKP is a cryptographic technique that allows the prover to confirm another person's claim without supporting data. ZKPs are cryptographic protocols that keep third parties away from user privacy. ZKPs can also be a useful building block for many cryptographic protocols, ensuring that participants adhere to protocol specifications. Privacy and scalability are enhanced with ZKPs because only certain data is revealed and processed without disclosing all the information that needs to be proven.

Based on ZKP technology, STARK, or Scalable Transparent Argument of Knowledge, invented by Starkware, is a type of cryptographic proof technology that allows data to be communicated to a third party, for example, to sign transactions without revealing the data . It also allows the computation and storage of committed data to be moved off-chain, increasing scalability.

STARKs is a quantum resistant system based on ...