There is a lot to like about what Midnight's trying to do. The big problem it is trying to solve is one of the reasons people are not using blockchain technology. This problem is about finding a balance between being open and being private. For people who have tried to work with ledgers it is clear that we need a different approach. The way thingsre now we can verify things without needing to trust each other but this system is not compatible with most uses of data in business, institutions and our personal lives. Midnight has a plan to use contracts and zero-knowledge proofs to solve this problem. This plan is easy to understand and makes sense. It puts privacy first than treating it as an afterthought.
When we look closer we see a big issue that Midnight has not fully addressed. This issue is not about the technology it is also about people and how things work in practice. Privacy and being able to verify things are not just opposing forces in code they are also opposing forces in how a community governs itself and learns from its mistakes.
Lets think about a scenario where a lending protocol is built on Midnight. A person who wants to borrow money can prove they have collateral without showing all their financial information. The lender can verify this proof. Give the loan. The zero-knowledge proof works perfectly protecting information while allowing the transaction to happen. This is the future that Midnight wants to create.
Now lets think about a scenario where something goes wrong. The lending protocol is exploited, because of a problem with the proof logic or a flaw in the contract. Money is. Something has clearly gone very wrong.
This is when we really test the design of Midnight. In a blockchain the community would publicly investigate what happened. Every transaction and interaction with the contract would be visible on a public ledger. Experts and community members could look at the evidence figure out what went wrong and learn from it. The transparency of the system in failure is what holds it accountable.
Midnights focus on privacy gets in the way of this process. The same feature that protects a borrowers information also hides the path of the person who exploited the system. The evidence of what went wrong is, to an extent, private.
The people behind Midnight might say that the zero-knowledge proofs are enough to verify everything. The network confirms that all transactions are valid.. This answer does not address the main issue. A proof system can only verify what it was designed to verify. It cannot catch problems in its logic or unexpected behavior. When a contract fails the question is not whether the proof worked correctly but whether the contracts logic was sound in the place.. It is much harder to audit a contract that is private than one that is transparent.
Making it easier for developers to build on Midnight by introducing Compact is a edged sword. It will attract developers, which is important for growth.. It also means that developers with varying levels of expertise will be writing contracts that make strong privacy promises to users. This combination of easy-to-use tools and private execution is a mix that requires extreme caution.
Midnight talks about " privacy " but this concept is only as good as its implementation.. A good implementation requires ways to hold people accountable that do not undermine the privacy model itself.
The question that remains is what happens when a Midnight-based application fails and causes harm to its users. What does the investigation look like? If it relies on developers and others voluntarily sharing information than a public record have we just shifted the problem of trust rather than solving it? Has the network in trying to solve the problem of transparency created a problem of accountability? This is the conflict that Midnight needs to navigate and it is a challenge that the industry is watching closely.
* Midnight is trying to solve a problem with blockchain technology
* The problem is about finding a balance between being open and being private
* Midnights plan uses contracts and zero-knowledge proofs
*. There is a big issue with accountability when something goes wrong
* The focus on privacy can hide the evidence of what went wrong
* The people behind Midnight need to find a way to hold people accountable, without undermining the privacy model
* This is a challenge that the industry is watching
1. Midnight needs to navigate this conflict
2. The industry is waiting to see how Midnight will solve this problem
3. The solution will require consideration of transparency and accountability.
@MidnightNetwork #night #NIGHT $NIGHT
