a16z Crypto: Zero-knowledge proof can protect user privacy and crack down on criminals
According to online reports, the investment department of venture capital firm Andreessen Horowitz(a16z), which focuses on cryptocurrencies, pointed out that modern encryption technologies such as zero-knowledge certificates can not only protect user privacy, but also allow law enforcement agencies to effectively crack down on criminals. In a report released Tuesday, Aiden Slaven, policy partner at a16z Crypto, and David Sverdlov, regulatory counsel, said zero-knowledge proof can verify the authenticity of data without revealing any detailed private information. They believe the technology has "the greatest potential" by demonstrating the source of funds without having to disclose private information. The report comes just two weeks after Roman Storm, co-founder of cryptocurrency mixing service TornadoCash, was convicted. Tornado Cash allows users to hide the source and destination of cryptocurrency, while Roman Storm was convicted of conspiracy to operate an unlicensed money transfer business, among other charges. In the Tornado Cash case, law enforcement and prosecutors argued that the mixed-currency service assisted criminal activity by providing a means to conceal illicit proceeds. Slaven and Sverdlov said in the report: "If users can provide such proof when converting cryptocurrency into legal tender, then the cash exchange point can obtain reasonable assurance that the cryptocurrency is not derived from the proceeds of crime, while also retaining the privacy of their on-chain transactions."
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