[sshine]

One place I wish there was zero knowledge proofs involved, or even any kind of cryptography, is when you perform credit assessment for loans outside your bank: an external loan provide peeks at your full bank account history to assess whether you’re eligible. They don’t need to know where I buy my socks, or even how much money I have. Only that I have a big enough deposit and a steady enough cashflow.

[foota]

This isnt a cryptographic problem really. The loan checker is already trusting your bank to give them the correct information, it's only a matter of anonymization (e.g., they could return merchant types instead of merchant names etc.,.) but theres no real incentive for this.

[sshine]

> theres no real incentive for this

Correct.

People who need the privacy can set up isolated bank accounts and legal entities.

Less cryptography, your accountant will even understand.

[edf13]

Where you spend can have an impact on a decision… e.g. you may have the income and savings but if you’re regularly spending on gambling that can be a red flag.

[hbbio]

You can prove that too with zk!

[rrr_oh_man]

How could this look like?

[sshine]

If the loan assessment criteria are objective, they can be quantified.

The basic concept here is: ZKP lets you prove arbitrary statements.

Instead of:

  Here is entire bank history, you decide.

You can say:

  Had a fixed income above $X for 12 months.
  Had a surplus of $X after fixed expenses in the last 3 months.
  Did not buy anything irregular above $1000 in the last 3 months.

"Did not gamble" is a moral judgement. Who knows, maybe I'm buying gum at the local casino, is that gambling? Maybe I'm tossing a coin every night after work as to whether I should drive in the opposite lane, is that not gambling? You can only objectively measure financially risky behavior in statistical terms.

Think of a ZK proof as a program that can take both public and private knowledge as input, and produce public and private knowledge as output.

This is what seems magical to me: A program with secret input. You can't run the program to verify that my execution of the program is correct, but you can verify a proof that I ran the program with input you didn't have.

The way private knowledge works is through cryptographic commitments.

For example, the bank may start by giving you a signed, structured document with your transactions.

You can then feed their signature and the document to your program, and produce any derivation.

[hbbio]

You can use the MCCs of each tx, then generating a zk-proof that shows none of the MCCs in your account match restricted categories.

This requires cooperation from the "bank", ideally providing Merkle trees to make sure no tx is missing in the proof like it would be for a blockchain-based solution.

[baby]

this is the example often cited as usecase for zkTLS protocols, which are protocols that use additional trust assumptions to notarize a connection you have with a TLS protected host, and then you can prove the notarization (i.e. a signature over the TLS transcript) in ZK as well as any parsing over request/response data.