Beyond Blockchain Week: A Tale of Decentralisation, Privacy, and the Emergence of NotVault

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Fresh from the bustle of Blockchain Week Australia, we find ourselves in the aftermath of intense debates surrounding blockchain’s core tenets of decentralisation and the mounting wave of private blockchains. Day 1 had some perceived contentious views from the banks, where customer surveys suggest convenience is more important than decentralisation. This sparked a lot of chatter and understandably so in a room full of web3 folks including crypto exchanges, asset providers, blockchain infrastructure companies and more. Yet, a closer inspection reveals a pattern that goes beyond mere convenience.

Banks, corporations, and governments gravitate towards centralisation and in some cases, private blockchains. This is due in part to customer convenience, and in part due to scam concerns, which the banks duly highlighted. However, we believe it is due to something else too, clarified during our participation in the Reserve Bank of Australia (RBA) Central Bank Digital Currency (CBDC) pilot project. Specifically, the transparency of public blockchain transaction records presents problems for businesses with a need for commercial confidentiality. In turn, this raises intriguing questions about privacy in a blockchain future.

Beyond Blockchain Week

Picture this, a cafe in a blockchain-powered world, where customers pay for their coffee using digital tokens. The transaction is recorded on the blockchain, and the customer can then trace the cafe’s entire transaction history using a block explorer and the knowledge of the cafe’s wallet address. While this provides unprecedented transparency, it also starkly contrasts the confidentiality that businesses (and individuals) enjoy in our current financial system.

The transaction is recorded on the blockchain, and the customer can then trace the cafe’s entire transaction history

It is therefore logical for corporations, banks, and governments that are keen to adopt blockchain technology to lean towards private or more centralised chains. These platforms, though not as decentralised, can provide a balance between the benefits of blockchain and the need for transactional confidentiality.

This led our team at NotCentralised to explore the potential of Zero Knowledge (ZK) proofs to reconcile the seeming contradiction between transparency and privacy. We delved deep into ZK technology, grasping the intricacies of ZK circuits and Circom technology, determining that ZK proofs need not be confined to layer 2 blockchains.

Layer 2 solutions, including Optimistic and ZK rollups, offer a path to scalability for Ethereum. However, they do centralise some components, which could compromise the full decentralisation ethos. Our alternative, encapsulated in our newly launched open-source solution, NotVault, allows ZK proofs to exist either off-chain or on any Ethereum Virtual Machine (EVM) compatible chain, including Coinbase’s BASE layer 2.

NotVault: Bringing Privacy to the Decentralised World

At its core, NotVault is an open-source Software Development Kit (SDK) designed for the secure and speedy creation of self-sovereign data workflows. Ranging from confidential commerce and payments to verifiable credentials, its applications are vast.

What makes NotVault unique is its underlying mechanism. It links a contact ID, such as an email, privately to a user’s wallet, generating a new public/private key pair for data encryption and signing within the ecosystem. This approach removes the need to access the Ethereum wallet’s keys, often inaccessible via API, offering a more user-friendly way to connect identities.

Moreover, NotVault builds on three fundamental principles: peer-to-peer operations to prevent single-point failures, encryption for continuous confidentiality, and ZK proofs to minimise data footprints during communication.

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Our journey has been paved with innovations, from the TradeFlows protocol, which leveraged blockchain for digital escrows and programmable payments, to Layer-C which encoded rules and regulations in smart contracts, ensuring DeFi can match or exceed Tradfi in terms of regulatory compliance if needed.

We were thrilled to introduce NotVault at the recent Blockchain Week, marking the next step in our pursuit of reshaping blockchain technology for everyday use. We’ve incorporated it into our other tools like TradeFlows and Layer-C and we want others to utilise it too. It’s why we’ve made it open source (sign up for beta access here: https://www.notcentralised.com/layer-c) and we have documentation for developers to read too (https://docs.notcentralised.com/).

Looking ahead, we believe NotVault could play a crucial role in the evolution of commerce. As blockchain technology becomes more pervasive, a platform like NotVault, which harmoniously melds the programmability of blockchain technology with the need for confidentiality, might become indispensable. With NotVault, businesses, individuals, and even governments can participate in a blockchain-powered economy without forfeiting privacy. By enabling ZK proofs on any EVM-compatible chain or off-chain, we bring a much-needed balance to the transparency-privacy equation.

NotVault: A Tool for the Future of Commerce

Developers who integrate NotVault into their applications can take advantage of its diverse set of features, including wallet functionality for safeguarding encrypted keys and metadata, and credentials that facilitate the generation and verification of zkSNARK credential proofs. It further simplifies confidential token transfers and self-sovereign, encrypted file storage.

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Additionally, the Commercial Deals feature manages the entire lifecycle of transactional or contractual agreements, including their financial settlement. It provides self-custody escrows of token payment amounts via a peer-to-peer platform, adding another level of security and trust to business transactions.

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Finally, the Service Bus, a confidential messaging service, ensures the integrity of timestamp, source, and underlying message using a zkSNARK, creating a secure and reliable communications network.

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All this functionality comes wrapped in an open-source package, available to everyone under an MIT License. We believe open source is a key pillar of innovation, fostering a collaborative and inclusive development environment where anyone can contribute and benefit.

A New Era: Blockchain, Confidentiality, and the Path Forward

Our journey through Blockchain Week Australia and the unveiling of NotVault brings into focus the intricate balance between privacy and transparency in the blockchain sphere. While the initial clamour for decentralisation underpins blockchain’s disruptive potential, the realities of business operations and regulatory compliance have nudged us towards a more centralised approach.

Yet, with tools like NotVault, we’re seeing the evolution of a middle path — a convergence of the best elements of both worlds. The future of commerce may well hinge on this blend of decentralised technology with layers of privacy and confidentiality.

At NotCentralised, we’re proud to contribute to this journey and excited to see how NotVault, and indeed blockchain technology at large, evolves in the years to come. Let’s continue this dialogue, explore these opportunities, and together forge a path to a more inclusive and efficient future.

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Mark
Monfort

Mark drives innovation with his deep understanding of AI, blockchain, and data technologies. His experience spans over 15 years of contributions to finance, technology, and operational strategy across Australia, Europe, and North America.

In 2021, he transitioned from Head of Data and Technology at a leading Australian accounting firm to startups. Prior to this, he worked in equity and macroeconomic research in the capital markets space.

Mark brings a passion for data and insights to NotCentralised. His understanding of AI and blockchain technology is central to the development of workplace productivity and financial system modernisation products, including SIKE and Layer-C. Mark’s dynamic and solutions-focused methods enable the navigation of complex technological landscapes and new market potentials.

Mark holds an Executive Master’s and a Bachelor of Commerce. He led the creation of the Australian DeFi Association and serves on the advisory board for the Data Science and AI Association of Australia. His commitment to such communities demonstrates his enthusiasm for emerging technologies and vision of positive change through technology adoption.

Nick
Bishop

Nick spearheads product strategy and institutional business development, leveraging a rich background spanning 23 years in capital markets and financial services across the UK, the US, and APAC.

In 2020, Nick transitioned into startups, bringing extensive experience in asset management and corporate advisory from roles including Director, Head of Australian Fixed Income at Abrdn and Managing Director, Head of Corporate Credit at Gresham Partners. His expertise extends to client management across the government and private sectors.

With a First Class degree in Law and Criminology and Chartered Financial Analyst experience since 2002, Nick is known for his energetic and creative approach, quickly appraising business models and identifying market opportunities.

Beyond his role at NotCentralised, Nick actively contributes to multiple startups and SMEs, holding various Board and advisory positions and applying his institutional expertise to early-stage ventures. Nick is fascinated by emerging technologies with significant societal impact and loves to immerse himself in nature.

Arturo
Rodriguez

Arturo leads product development and software engineering, applying over two decades of experience in technology, capital markets, and data science. With his years of programming expertise, Arturo smoothly transitioned into blockchain, AI, and machine learning.

Arturo has built and sold technology startups across Europe, following quant derivatives roles in global investment banks. His prior experience includes data projects for the NHS in the UK, Strategic Technology Advisor at Land Insight, and Senior Advisor to OpenInsight, where he built predictive models for vessel usage in commodity markets.

A mathematics and statistics graduate from Stockholm University, Arturo’s early grounding in logic problems and data manipulation techniques is evident in his practical applications. His work building equity derivative pricing models for Merrill Lynch and Royal Bank of Scotland showcased Arturo’s highly specialised skillset.

Arturo relocated from London to Australia in 2020. Beyond NotCentralised, his passion for technology and industry involvement extends to the Australian DeFi Association, which he co-founded, and regular contributions to the Data Science and AI Association.