Monero (XMR), one of the world’s leading privacy-centric cryptocurrencies, has recently adopted a new technology known as “bulletproofs”, becoming the first major cryptocurrency to adopt the technology. The adoption of bulletproofs by Monero has made the coin much more efficient, and helped enhance security and user privacy. Bulletproofs are a new kind of non-interactive zero knowledge proof protocol. This new zero knowledge proof protocol does not require a trusted setup, unlike the kind of zero knowledge proof protocols such as zk-SNARKS, which is used in cryptocurrencies like Zcash. Bulletproofs allow for very short zero knowledge proofs and confidential transactions. The developers of other cryptocurrencies, such as Litecoin, have been reported as saying they are considering implementing bulletproofs as well.
Since Monero has adopted bulletproofs as of Thursday, October 18th 2018, the average size of confidential transactions on the network has plummeted by 80%, from an average confidential transaction size of 18.5 kilobytes to an average confidential transaction size of just 3 kilobytes. Transaction sizes aren’t the only thing that have been reduced with the new fork of Monero which implemented bulletproofs, the average Monero transaction fee has also plummeted. Bulletproofs are said to improve the scalability of cryptocurrencies. In the white paper for bulletproofs, researchers discussed how the set of Unspent Transaction Output, or UTXO, for Bitcoin could be decreased by a factor of 10 if confidential transactions and bulletproofs were implemented. Implementing such technology would shrink down the size of the UTXO set from around 160 gigabytes to just 17 gigabytes.
The invention of bulletproofs technology was first reported in December of last year, when a white paper, titled “Bulletproofs: Short Proofs for Confidential Transactions and More,” was published describing the new technology. The Bulletproofs technology was invented by Jonathan Bootle of the University College of London and Benedikt Bunz of Stanford University. Bulletproofs were created through techniques that were previously developed by Jonathan Bootle. Benedikt Bunz told a reporter for CoinDesk that the underlying cryptography behind bulletproofs has been around since the 1970s, but explained that new breakthroughs have now allowed the technology to be applied to cryptocurrencies.
A bloated blockchain was becoming a problem for Monero, according to a developer who goes by Sarang Noether. However, bulletproofs appear to have made Monero much more efficient. Sarang Noether was one of the Monero developers who helped to implement bulletproofs. “We’re excited about it. Part of the reason we do the upgrades is so we can be safely on the cutting edge, and I think this is a really, really good move forward,” Sarang Noether told CoinDesk. While bulletproofs technically do improve the assumed privacy of confidential transactions, their implementation alone is only one part of what makes Monero private. “They’re not about anonymity; they are about assuring that the other stuff we do for anonymity works correctly,” Sarang Noether told a reporter.
Monero’s privacy features primarily depend on three main technologies, which include, stealth addresses, ring signatures, and ring confidential transactions, also known as RingCT. RingCT works by obscuring the amount of Monero being transferred in a transaction. Bulletproofs make RingCT obscure transaction amounts more efficiently. Prior to the implementation of bulletproofs, Monero used a technology called Zero Knowledge Range Proofs, or ZKRP. Zero Knowledge Range Proofs were slow and created long range proofs. Bulletproofs were not the first non-interactive zero knowledge proofs protocol that Monero developers had considered implementing for their privacy-centric cryptocurrency. In October of last year, DeepDotWeb reported on a zero knowledge proof protocol known as Zero Knowledge Scalable Transparent Arguments of Knowledge, or zk-STARKS, which developers with the Monero Research Labs were exploring at the time. Like Bulletproofs, zk-STARKS does not require a trusted setup. However, in the white paper for bulletproofs, the researchers explain that zk-STARKS creates range proofs that are larger in practice than other proposed solutions.
The new version of Monero includes other updates besides the implementation of bulletproofs, such as an increase to the mandatory ring size. This increase is meant to help increase anonymity and make Monero less vulnerable to linking attacks. The new version of Monero also includes another update which tweaks the mining algorithm, a change intended to prevent the mining of Monero using ASICs.