As a technology that is just over ten years old, it can be argued that in the grand scheme of things, the body of research and innovation that has been developed around blockchain is in its infancy–years from now, today’s blockchain researchers could be remembered as those who laid the foundations for the future of the world’s financial systems.
Therefore, today’s blockchain researchers play a vital role–not only in the contributions that change and innovate the blockchain networks that we use today, but also in the systems that the world could rely on in the future.
Blockchain researchers also hold a rather advantageous position in today’s blockchain industry because of the fact that so many individuals working on the business side of blockchain are also creators and researchers of blockchain technology; unlike many other industries, the academic side of blockchain is not so far removed from the enterprise side.
One of these individuals is Ben Fisch, a renowned cryptographer who is currently a PhD Student in Cryptography at Stanford and the Chief Scientist and Co-Founder of blockchain protocol firm Findora.
We asked Ben about his own academic research in blockchain and cryptography as well as the vision behind the building of Findora. Ben also broke down some key technical concepts in blockchain and cryptographic research, as well as some of the ethics behind blockchain innovation, and the connection between academia and enterprise in the blockchain and cryptocurrency industry.
Why does the world really need blockchain?
However, before we got into the nitty-gritty of blockchain ethics and tech, we asked Ben a simple question–why the world really needs blockchain-based financial systems, including Findora?
He explained that there are several reasons–“[traditional] financial systems are isolated,’ he said. “There’s many ‘data silos’ of financial data, and networks are somewhat isolated, which runs into complex ways of trying to settle transactions that have happened on different financial networks.”
As a result, part of Findora’s mission–”and the whole blockchain movement,” Ben added, “is moving toward use of a common, public database; a single system where financial transactions happen so everyone can look at the same thing–that has efficiency benefits.”
“The second thing is transparency,” Ben continued. “When you look at capital management, traditional capital management is extraordinarily opaque. When you put your money in an investment fund–or really, when you use most [financial] platforms–you don’t know what’s happening behind the scenes.”
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“And that’s what leads to the potential for fraud–that’s what enables things like the Madoff multi-billion dollar Ponzi scheme. People who were putting their money with Madoff were just trusting him based on the reputation of his firm, and not really being able to verify what was going on behind the scenes–and this happens time and time again,” he said.
“It’s a bit different than the issue with currencies that are being issued by countries that don’t have a stable currency or that have too much control and are able to cause hyperinflation, but it all stems from this issue of transparency–being able to see exactly what the financial system is doing.”
Successful blockchain networks must master the fine art of balancing transparency and privacy
But in order to operate successfully, blockchain networks must balance transparency with privacy. Of course, “blockchain protocols are ,” Ben said. “So, a naive solution to transparent finance would be that [everyone] uses an open database–all the transactions that an investment fund like Madoff’s would be processing would just be visible to everyone…therefore, you can verify instead of trust.”
“The problem with that solution, unfortunately, is that it does not provide any privacy [for users],” Ben said.
“Therefore, it precludes most financial applications because privacy is central–many financial transactions are sensitive, whether they’re run by businesses or individuals, whether it’s a salary [payment] going to an employee, whether it’s a private amount being sent between two friends or relatives, or whether it’s a large transaction happening between corporations–privacy is necessary for usability.”
So, what’s the solution? For Findora, the protocol that Ben co-founded, the solution is the usage of a form of cryptography known as “Zero-Knowledge Proofs”, or ZKPs. “We use Zero-Knowledge Proofs to retain the transparency of an open database while encrypting transactions,” he explained.
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This technology–which is also implemented on a number of other blockchain networks, particularly those that have been designed with privacy in mind–allows users to “verify certain things,” including whether or not fraud has occurred. Therefore, for example, an investment fund using this technology “could prove to you anything that you would want to audit…I can prove that I’ve passed the audit without revealing my books to you.”
Blockchain innovators “rely on the legal and regulatory systems in order to determine what is the necessary balance of transparency and privacy.”
But when it comes to creating blockchain networks that protect users and support things like audits, how do blockchain researchers know what kind of ethical code to follow when networks are created? Is there some sort of unspoken agreement between engineers, or does each creative team march to the beat of its own ethical drum?
Ben said that from his own perspective, “as blockchain researchers, or engineers, or creators, our goal is to make the technology as powerful and flexible as possible in order to be able to meet different needs,” Ben said. “I would say that in order to determine what is the necessary balance of transparency and privacy.”
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However, the balance can be difficult to achieve–”I know that I, as an engineer, would never want to build something that is being misused, or to create something that does more harm than good,” he said. But as far as his own creation, “I really see building technology like Findora as enabling this balance, and therefore enabling the appropriate actors in the world to be able to configure the system so that it really meets everyone’s needs.”
What is Findora, and how was it built?
“I ended up [co-founding] Findora a little over a year ago,” Ben said, adding that “it really came out of my desire to apply the tools I’ve been working on in a way that I see more directly impact[ing] the finance world–so, a bit closer to what I see as a transformative movement in finance.”
Ben explained that at its core, “Findora is a network protocol for managing a financial database. We say that it’s a ‘confidential protocol that enables seamless, secure, and fully-compliant transfer, and verification of assets’, but in more simple terms, it’s a system that allows you to issue any kind of asset–that could be money, so a bank could issue banknotes–and users can send that money just the way that they handle physical cash.”
However, “it can [also] be other kinds of assets, like real estate or any kind of security; if a company issues stock, [that company] can issue it in a digital form on our network protocol.”
Ben continued to say that the protocol isn’t restricted to operate within any one setting–there can be a version of the technology that’s being operated in some private network operated by a small consortium of banks, or there could be a worldwide decentralized operation that looks more like the Bitcoin protocol is supposed to.”
The dynamic of blockchain’s marriage between academia and enterprise
In addition to being one of the founders of Findora, Ben is also a PhD student in the Stanford Applied Cryptography group. Therefore, he has a unique window into the connection between the academic and enterprise sides of the blockchain and cryptocurrency world.
How well-connected are these two hemispheres of the blockchain brain? “I would say that especially within the blockchain engineering world, there is really a good of the cryptocurrency and blockchain industry–in fact, I would say that there’s really a grey line in between researchers and practitioners.”
My talk on Transparent SNARKs from DARK compilers (Supersonic) at ZK Summit. Thanks again to for organizing.
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“Blockchains have been maturing tremendously over the past few years, and everyone knows that some of the most important problems to solve were technological problems, so academics (and research produced by academia) was very much embraced by the industry, and the industry was inspiring problems to work on as well as contributing research [itself].”
Indeed, “there are many papers written by people–open, public information that’s being contributed by people working in the blockchain industry. There’s also a huge open-source initiative, and the tendency is to write research papers and public open-source code on GitHub rather than to retain proprietary secrets.”
“That’s quite nice to see,” Ben continued. However, “fundamentally, the incentives in research and business are fundamentally different–so that does maybe pose some tension.”
“Academics in businesses have in common that they want to better the world,” Ben explained. “[…] But businesses, of course, also have the incentive to make money–that’s a driving force behind the decisions that the company makes. Companies have investors, and are influenced by the needs of those investors.”
On the other hand, academic researchers have incentives that aren’t purely motivated by the pursuit of knowledge: “similarly, in academia, academics want to ascend the academic ladder–publish more, and therefore, perhaps get more recognition.”
Explaining “Supersonics”
Therefore, it could be argued that individuals like Ben–who have one foot in the enterprise side of blockchain and the other foot in blockchain’s academic sphere–are doubly incentivized to advance blockchain technology. And Ben has–most recently, with research on a zero-knowledge proof system known as “Supersonics.”
“Until recently, zero-knowledge proof systems existed but were not practical because they were either too large to communicate…or they would take too much time to verify and check.”
Yes! Supersonic is finally a trustless snark with log n size proofs and log n time verification for arbitrary statements. Bulletproofs was log n size, but with linear (inefficient) verification.
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“Supersonics are both small and fast to verify,” Ben explained. “But there’s one other very key thing, which is that they don’t rely on trust[ing] any third party–they don’t rely on what’s called a ‘trusted setup.’” Prior zero-knowledge proof systems that operated with similar efficiency did rely on a third party. Ben told us that Findora is currently in the process of implementing Supersonics technology into its own protocol.
This was an excerpt. To hear cryptographer and Findora co-founder Ben Fisch talk more about Findora and his cryptographic research, including more information on Zero-Knowledge Proofs and ‘Supersonics’, please visit us on or
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