Blockchain
Zero-knowledge cryptography is bigger than web3
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When people talk about zero-knowledge cryptography in 2024, they’re often referring to a privacy-focused use case that relies on a combination of blockchain technology, cryptocurrencies, digital wallets, and users with some degree of web3 knowledge.
Zero-knowledge proofs have existed since the 1980s, long before the advent of web3. So why limit their potential to blockchain applications? Traditional companies can—and should—adopt ZK technology without fully embracing web3 infrastructure.
At a basic level, ZKPs unlock the ability to prove something is true without revealing the underlying data behind that statement. Ideally, a prover creates the proof, a verifier verifies it, and these two parties are completely isolated from each other in order to ensure fairness. That’s really it. There’s no reason this concept has to be trapped behind the learning curve of web3.
Most organizations that could benefit from ZK technology aren’t using blockchains or are not even aware of web3. The industry is still young, with many just now familiarizing themselves with Bitcoin (BTC) and Ethereum (ETH), not to mention Layer 2s and 3s.
Despite all that, ZKPs can already be applied to a variety of real-world use cases, and they don’t need to integrate fully web3 rails to do so.
Do you trust your slot machine payout?
With zero-knowledge proofs, you don’t have to trust a gaming operator. You can just enjoy playing and have peace of mind knowing that the game is designed fairly. Every digital gambling machine in the world should be designed with ZKPs; it just makes sense for the operators and the players. The best part is that players can enjoy the benefits without the words “web3” or “crypto” even entering their minds.
Recently, DraftKings and White Hat Gaming were fined $22,500 by the state of Connecticut for their online slot machine game, which failed to pay any winners over one week in August 2023—even though there were more than 20,600 spins that week. The game advertised that nearly 95 cents would be paid out for every $1 wagered, so the algorithm should have returned $19,570 to the players who wagered $20,600 in spins. Instead, players lost $20,600—all of which went to DraftKings.
This is where zero-knowledge proofs can make a big difference. A ZKP could prove that a game paid out a certain amount of money over a given period and at a specific hit rate without revealing individual spins or player identities.
This is great, but there is still the problem of verifying the proof. Someone needs to ensure that DraftKings, or any gaming operator, constructed the proofs correctly based on all the required data. It could be DraftKings themselves, but we shouldn’t trust them to handle their own verification. A regulator or auditor could do it, but this would likely cost DraftKings a lot of money, which would then be passed on to the customer.
In this situation, the best option is a public and decentralized network built specifically to verify proofs in a quick and cost-effective manner. Instead of the user being asked to trust a centralized entity, they can trust a decentralized protocol that ensures nefarious actors (i.e., those who may try to verify an incorrect proof) are punished if they misbehave.
AI output and trustworthiness
AI’s potential for deception is well-established. However, there are ways we can harness AI’s creativity while still trusting its output. As artificial intelligence pervades every aspect of our lives, it becomes increasingly important that we know the models training the AIs we rely on are legitimate because if they aren’t, we could literally be changing history and not even realize it. With ZKML, or zero-knowledge machine learning, we avoid those potential pitfalls, and the benefits can still be harnessed by web2 projects that have zero interest in going onchain.
Recently, the University of Southern California partnered with the Shoah Foundation to create something called IWitness, where users are able to speak or type directly to holograms of Holocaust survivors.
This is an undeniably powerful use of machine learning. There’s something so strangely moving about interacting with a hologram of a Holocaust survivor and feeling like you’re having a real conversation. But with a subject this sensitive, it’s even more crucial that the algorithm underlying the hologram is generating factual information.
Enter zero-knowledge proofs. If we were to reimagine this project, we might consider adding a “proof of algorithm output” where the user is able to see evidence that the responses they are seeing are based on a Natural Language Processing algorithm that was correctly trained on troves of historical transcripts and interviews with Holocaust survivors, ensuring that the information presented is accurate.
ZKPs make it possible to get proof of this input data and AI training without revealing the underlying information. Fact-checking the Holocaust information would also require perusing vast amounts of data, potentially requiring the end user to download or access large data sets and then spend hours reading or watching interviews. ZKPs allow the user to forgo this tedious and resource-intensive process.
In this case, we might trust USC to verify proofs for this particular project, but there are certainly more use cases with AI where the end user may not want to trust a centralized entity to both create and verify proof. When incentives to construct “fake” proofs and have them verified align, decentralized proof verification makes the most sense.
ZK is a trustless, decentralized system for all
We don’t need to trust companies or robots to tell us the truth because we have ZK. Many industries can level up with zero-knowledge blockchain solutions, even if they know nothing about the web3 space.
By tapping into ZK proof verification, companies and institutions can essentially keep doing everything they have been infrastructure-wise. They just need to create a simple system for proof creation and then use a decentralized system like zkVerify to handle the proof verification. Even though a blockchain is used, the users don’t need to worry about that.
The future of ZK will be massive, and organizations won’t have to change much to reap the benefits. They can just plug and play.
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Altcoin
Solana Price Eyes Breakout Toward $143 As Inverse Head & Shoulders Pattern Takes Shape On 4-hour Chart
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Solana appears to be gearing up for a major technical breakout, with recent price action building up an interesting chart formation. A familiar bullish pattern has formed, and if validated, it could drive the price to a level not seen in recent weeks. This new development was highlighted by popular analyst Titan of Crypto on social media platform X.
Pattern Breakout Sets $143 In Sight
Like every other large market-cap cryptocurrency, Solana has experienced an extended period of price crashes since late February. In the case of Solana, this price crash has been drawing out since January, when it reached an all-time high of $293 during the euphoria surrounding the Official Trump meme coin. Since then, Solana has corrected massively, even reaching a low of $97 on April 7.
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The price action before and after this $97 low has created an interesting formation on the 4-hour candlestick timeframe chart. As crypto analyst Titan of Crypto noted, this formation is enough to send Solana back up to $143.
At the heart of the latest bullish outlook is a clearly defined inverse head and shoulders structure, which is known for its reliability in signaling a reversal from a downtrend to a bullish breakout. The left shoulder of the pattern began forming in early April as Solana attempted to rebound from sub-$110 levels. The subsequent drop to the $96 bottom on April 7 formed the head of the structure. From there, a recovery started as buyers cautiously stepped back in, giving rise to the right shoulder.
The breakout of the neckline resistance has taken place in the past 24 hours. With this in mind, Titan of Crypto predicted that $143 becomes the next logical destination based on the measured move from the head to the neckline.
Image From X: Titan of Crypto
Momentum Strengthens With Structure Confirmation
Looking at the chart shared by the analyst, the momentum behind Solana’s price movement appears to be gaining strength. Trading volume is an important metric in evaluating the strength of a breakout, and the volume accompanying the recent breakout above the neckline seemingly confirms it.
Particularly, Solana has seen a 5.3% increase in its price during the past 24 hours, with trading volume surging by 3.76% within this timeframe to $4.21 billion.
Although it is common to see a throwback or minor consolidation just above the neckline, the projected path suggests continued upside as long as price action holds above that key breakout zone.
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At the time of writing, Solana is trading at $129, 10% away from reaching this inverse head-and-shoulder target. A move to $143 would not only represent a meaningful recovery from April’s lows but could also improve the confidence in Solana’s price trajectory moving into Q2. The next outlook is what happens after it reaches this target of $143, which will depend on the general market sentiment.
Featured image from The Information, chart from TradingView
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Disclosure: The views and opinions expressed here belong solely to the author and do not represent the views and opinions of crypto.news’ editorial.
The internet is at a crossroads. People are continuing to express their frustration and dissatisfaction with the internet—double that of what they felt 20 years ago—as centralized platforms are facing increasing scrutiny for their opaque algorithms, data exploitation, and bias in content curation.
Most online platforms today run on web2, where FAANG companies—Meta, formerly known as Facebook, Amazon, Apple, Netflix, and Alphabet, formerly known as Google—control the data, serve ads, and track users for profit. Users are ultimately the product, and while these companies have added billions in market cap by turning users into the product, this is far from the best model for creating a sustainable knowledge engine like the internet. Participants in the internet ecosystem are starting to wake up to the fact that this model doesn’t really work for anyone except those FAANG companies.
Nowhere are these problems more evident than in search. Search is one of the most fundamental activities on the internet and, thus, stands at the forefront of “gatekept content.” If the internet really is our collective knowledge engine, then search is the first step in acquiring that knowledge.
It is sometimes even the last and only step in using the internet to acquire knowledge, considering that the first result on a Google page has a clickthrough rate of over 25 percent and the tenth result, proportionately, only has a tenth of that. Presumably, a fraction of that fraction even makes it to the second page of results.
Now, consider Google’s prominent position in all of search. Even while Google’s search market share last year dropped below 90 percent for the first time in 10 years, it is still within the range of the popular vote total for a third-world dictator. So, the One True Result that has been served up by Google’s algorithm is getting a quarter of the traffic for the search engine that still holds somewhere in the area of 90 percent of the search engine market share. That’s a lot of opaque and centralized power centered in one private company.
Even while competitors like DuckDuckGo and Bing try to carve out some of their own market share by offering AI-powered search or increased privacy, as centralized companies, they fundamentally present the same problem Google does, without the market share. The integrity of our search results has never been more crucial, and we can’t leave it to web2 structures to be good custodians of that integrity, especially when the priorities of those structures to protect their users can turn on a dime.
The solution is here: Enter web3
How do we put how information is organized back into the hands of users, especially as the search engines promise to become even more inscrutable with the implementation of AI and the obscuring of sources?
One possible way to put that power back into the hands of users is what has thus far been built with web3. Web3 can allow us to build a decentralized, community-powered search engine while participating in a truly open and trustless search ecosystem. A decentralized node-powered ecosystem can ensure fair, unbiased, and censorship-resistant search results, free from the corporate agendas that have shaped traditional search engines.
Instead of relying on corporations, web3 platforms are permissionless, sovereign, and decentralized. They are powered by blockchain and smart contracts instead of centralized corporate servers that open users to vulnerabilities and data insecurity. Web3 gives users control back over their data, identity, and digital assets.
There are a host of other ways in which web3 can empower the user. These include self-sovereignty, permissionless control of assets without fear of confiscation, self-custodial staking and earning, access for the unbanked, peer-to-peer transfers, and, perhaps most important of all, that fundamental decentralization, which eliminates single points of failure while being resistant to manipulation.
There is also no behavioral profiling, no centralized control, and no data tracking. This means no censorship risk, no suppression of competing voices, and a search experience that respects user privacy.
Users must work to reclaim power
Search engines today function as gatekeepers of information, with centralized platforms deciding which content is amplified, suppressed, or monetized based on user profiles and corporate interests. Users deserve a fairer and ultimately better search experience, one where ranking algorithms are not influenced by personal data, past behavior or profit-driven agendas.
The problem is bound to get worse as the AI race heats up and companies look for new data sources on which to train these AIs. Whatever promises a centralized company might have once made to the user about not tracking or using data, again, these priorities can shift very quickly in something like an AI technology realignment. The beauty of web3 is that the structure of the technology itself prevents such exploitation.
Web3 may seem abstract right now, but it’s not all that different from the kind of technical fluency users needed to acquire as they went from the personal computer to the networked personal computer of web2. Users essentially just have to trade out an encrypted password shared with a central web service (and who knows where else) for an encrypted wallet that only they can control and access. The benefits of full control over assets and data will far outweigh whatever stumbling blocks there are to this learning curve.
Users have shown that they are willing to trade a lot for convenience, but perhaps they’ve reached a breaking point in that bargain. Now is the time for web3 to take advantage.
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Disclosure: The views and opinions expressed here belong solely to the author and do not represent the views and opinions of crypto.news’ editorial.
AI-generated avatars and virtual assistants will revolutionize our digital landscape, powering virtual influencers, workplace stand-ins, and immersive metaverse experiences. Yet, beneath this technological marvel lies a pressing question: who truly owns and controls your digital identity? The reality is stark—most AI avatars are tethered to centralized platforms where corporations hold dominion, exposing users to exploitation, financial fraud, and a profound loss of autonomy. As these digital personas become integral to our virtual lives, the need for a transformative solution has never been more urgent.
Decentralizing AI avatars through blockchain technology and smart contracts emerges as a vital antidote, promising to restore control to individuals in an increasingly virtualized world. The dangers of centralized systems are vividly demonstrated by high-profile abuses that have shaken public trust. In January 2024, a deepfake robocall mimicking U.S. President Joe Biden targeted New Hampshire voters, falsely urging Democrats to skip the primary in a bid to sway the 2024 election. This brazen act of manipulation, which prompted an FCC ruling to ban deepfake robocalls and ignited debates over AI regulation, exposed the fragility of centralized platforms that harbor the data fueling such scams.
The entertainment industry offers another stark warning. In early 2024, explicit deepfake images of Taylor Swift flooded social media, amassing over 45 million views before removal after a 17-hour delay. This incident laid bare the limitations of centralized content moderation, which often falters under pressure, leaving women and public figures disproportionately vulnerable to digital harm. The fallout was swift—Swift’s team condemned the breach, and platforms scrambled to respond, yet the delay highlighted a systemic failure to protect digital likenesses in real-time.
Additionally, Meta’s Oversight Board recently took up cases involving deepfake explicit imageries, noting inconsistent moderation practices— certain content was removed faster than others due to not passing specific community guidelines, highlighting inequities in centralized systems. These examples show how centralized avatar management leaves users powerless and unable to prevent misuse of their digital likeness.
Why AI avatars need to be decentralized
Centralized platforms trap users in ecosystems where their digital identities are subject to exploitation or sudden deactivation at corporate whim. This unchecked dominance shatters the vision of a user-empowered digital future, reducing individuals to mere cogs in a profit-driven machine. Decentralization flips this narrative, fostering self-sovereign identity where users hold the reins, owning and managing their avatars with confidence.
By placing control in the hands of individuals, decentralized systems can curb corporate overreach, ensuring AI avatars reflect their creators’ intent rather than serve as tools for exploitation.
Blockchain-powered AI ownership
Blockchain technology stands as a beacon of hope against these escalating threats. Through on-chain verification, it forges an unalterable record of avatar ownership, forging a secure bond between digital identities and their rightful owners while decisively countering unauthorized deepfake abuse.
This was painfully evident in February 2023, when a French interior designer fell pray in a romance scam: fraudsters wielded AI-generated images and messages to impersonate Brad Pitt, spinning a tale of a fabricated relationship and a fabricated cancer diagnosis that convinced her to part with €830,000—her life savings—before the deception unraveled. Such episodes unveil the dangers of centralized platforms, which hoard user data and become fertile ground for AI-driven fraud, eroding trust and inflicting devastating personal losses. Without a verifiable system to authenticate digital identities, AI-driven deception will only intensify. Users are left defenseless as deepfakes become more sophisticated and harder to detect. The challenge is clear: How can we secure digital avatars against misuse while ensuring individuals, not corporations, maintain control over their online presence?
Yet, blockchain’s potential extends further. Smart contracts bolster this framework by automating rights management, guaranteeing avatars operate with unwavering security and transparency while fortifying defenses against fraud. This comprehensive approach not only shields digital assets from theft but also alleviates the ethical and legal burdens intensified by centralized oversight, equipping users with verifiable dominion over their virtual selves.
A web3 future for AI avatars
Decentralized AI avatars can also drive a vibrant web3 economy, integrating into metaverses, digital workspaces, and decentralized social networks. These avatars can become dynamic assets—representing users in virtual worlds, facilitating remote collaboration, or enabling secure interactions online. Picture a musician selling a unique avatar on a decentralized marketplace or a professional using a blockchain-verified digital twin to authenticate their presence in a virtual meeting. This ecosystem thrives on user ownership, positioning decentralized AI avatars as a foundation for the next digital economy.
The drive to decentralize AI avatars is non-negotiable—centralized systems, exposed by explosive deepfake scandals and crumbling moderation, threaten to dismantle safety and freedom in an AI-drenched world. Blockchain carves a decisive path to empowerment, handing the reins of digital identity back to individuals, not corporate overlords. The clock is ticking: seize control of your digital destiny now, or watch it vanish into a dystopian abyss of corporate domination.
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