The Issue of Regulatory Compliance & Non-Consensual Data Sharing

While Zero Knowledge Proofs are helpful, they aren't enough...

Zero-knowledge KYC can prevent honeypots and massive surveillance, but is insufficient by itself for common use cases in which regulators or law enforcement need to investigate users suspected of committing crimes.

As a result, maintaining honeypots has become a necessary practice to comply, keeping sensitive data that regularly is breached so that it's ready to be divulged in an investigation.

Solving The Dilemma: Proof of Clean Hands With Mishti Network

While ZK proofs aren't trivial, ZK proofs with compliance are even less trivial. Hence, Holonym has built Mishti Network, a network on EigenLayer that allows provable threshold encryption. The network has no centralized party that can decrypt user data. Instead, it allows users to create ZKPs which can be "decrypted" by pre-approved parties only when a smart contract is triggered. One use case that can be built on top of the network is provable encryption of identity.

Zeronym packages this into a very easy to use solution called proof of clean hands. This serves as a general-purpose compliance tool. Once a user has a proof-of-clean-hands SBT, we know the data is encrypted to an observer that can only decrypt a small amount of data per day, ensuring no surveillance or honeypots are possible but complying with law enforcement or regulators is possible.

For more information, see the architecture

Clean Hands

Or usage

Clean Hands