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Dutch multinational bank ING Group announced that it had found a way to address one of the top challenges financial sector players face in using blockchain, namely protecting data privacy.

Blockchain is one of the technologies that can ensure the transparency of data and transactions. Even though transparency is a clear benefit in the majority of cases, banks and other financial institutions have been trying to find ways of keeping data private.

ING’s distributed ledger technology (DLT) will have a special code known as “zero-knowledge range proof (ZKRP).” It comes with an additional cryptography configuration that allows verifying a particular statement without showing details related to it. A loan applicant, for instance, can prove the range of their salary without indicating the precise figure.

Mariana Gomez de la Villa, who runs ING’s blockchain program, said:

"Until recently, one of the primary challenges for applying blockchain in the banking sector was ensuring that data privacy was protected and at the same time meeting regulatory reporting requirements.”

ING is not the first entity to apply itself to zero-knowledge code, but it is currently one of the few banks showing great interest in it. The company claims that ZKRP is ten times as efficient as similar solutions on Ethereum blockchain.

The bank has introduced ZKPR as an open source service, allowing other developers to get access and make contributions to it.

“While existing zero-knowledge technology has provided us with a way of overcoming that, the main limiting factor is the resource, and therefore cost, that each verification would generate,”  Gomez de la Villa added.

The financial industry is the most active one when it comes to blockchain experiments and implementation. The technology was recently proved to be efficient in a major project. The pilot, which delivered a 100% success rate, involved banking giants such as JPMorgan Chase, Goldman Sachs, Citibank, Credit Suisse, and BNP Paribas. The aim was to streamline equity swap operations.