QEDIT, a company that develops privacy technology for the enterprise blockchain, has completed a $10 million Series A round of investor participation, including Ant Financial.
The two companies announced on Tuesday that Ant Financial will also incorporate QEDIT's zero-knowledge proof (ZKP) technology into its blockchain project . Other well-known partners applying QEDIT ZKP include software giant VMWare and RGAX, a subsidiary of American Reinsurance Group.
This round of QEDIT financing was led by MizMaa Ventures, and Ant Financial and RGAX and Meron Capital, Collider Ventures, Jovono and Target Global all participated in the investment. QEDIT has so far received $14 million in grants, including this round of Series A funding, the previous round of $3 million in seed financing and $1 million in grants.
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Jiang Zhigang, vice president and general manager of Ant Financial Technology and Business Innovation Group, said in a statement:
“Ant Financial and QEDIT share a common vision for protecting data privacy and security. Sound privacy protection is critical to the continued development of the financial industry. Together with QEDIT, Ant Financial is committed to using these functions as our blockchain. Part of the service."
Qonathan CEO and co-founder Jonathan Rouach said his company's ZKP program in Tel Aviv, Israel, is compatible with most corporate blockchains, making the company attractive in Asia.
Rouach told CoinDesk:
“We have been promoting our products to large suppliers in Asia, one of which is Ant Financial, the world's largest financial technology company. Therefore, our products are compatible with Ant Financial Blockchain products.”
He pointed out that Ant Financial has launched a blockchain product and is very familiar with the privacy needs of asset transfer. (Ant Jinfu has applied the blockchain to remittances between Hong Kong and the Philippines and to track the origin of rice grown in China.)
“We have heard less in the West, but there has been a lot of progress between blockchain companies and East Asian countries.”
To take a step back, the zero-knowledge scheme provides a way to prove that you have a secret without revealing the secret itself. Many people try to apply this technique to fix privacy on the blockchain, which by default is biased towards broadcast data.
For example, Rouach said that QEDIT showed how to prove that a person is at a certain tax level without obtaining basic data on the Ethereum blockchain. Later, BNP Paribas conducted a proof of concept (PoC) around trade finance collateral management to prevent fraud when traders used the same collateral to obtain two financings from two different banks.
"Because banks can't cooperate on private information, they can't know if collateral has been counted in other financial sectors. We have a mechanism in the blockchain where banks can check that collateral has only been used once. Without having to share customer information."
Rouach outlines how QEDIT's zero-knowledge technology is used by companies such as Ant Financial and VMware. He said that when a network is running in multiple cloud environments, the ZKP solution allows blockchain cloud deployment without having to choose between them. Any sensitive information is disclosed outside of the cloud provider.
"We are increasingly seeing some industries use blockchain companies as their backbone, and competitors have joined the network. We have integrated Antchain and VMware's blockchain stack into the enterprise blockchain stack. Let customers choose the blockchain as the service provider and include QEDIT's privacy layer solution by default."
When applied to the insurance industry, ZKP helps fight against claims fraud. In this type of fraud, the applicant is able to use the information asymmetry between the insurance companies to make multiple claims for the same loss or event (the insurance company cannot solve this problem due to the information sharing restrictions between them).
“With ZKPs, insurers can prove that an incident has occurred without disclosing potential safety information. QEDIT can reliably use the claims event data of each insurer without having to hand over the data itself to anyone, thus avoiding claim fraud. ”
When it comes to using ZKPs, a practical obstacle is the amount of computation that these proofs can consume, which can hinder the performance of the blockchain. Like many projects in the field, QEDIT is working to address the scalability and performance challenges surrounding zero-knowledge solutions.
To this end, Rouach and his team devised a expansion mechanism called "proof chaining" that can generate proofs in parallel. He says:
"This allows us to come up with a proof, cut it into smaller chunks, then parallelize the chunks on different machines and do it in a scalable way."
Rouche said that in addition to making this technology more practical, QEDIT also supports efforts to standardize ZKPs in order to sell it to businesses.
This will move the blockchain from the test PoC to the actual deployable network; this allows competitors to be part of the same network without having to rely on certain central authorities.