Some experts believe that ring signatures provide unparalleled privacy to the users of a network. Ring signatures are a branch of cryptography that has very similar features to the encryption process of cryptocurrency platforms. Recently, cryptocurrency firms that place privacy on a pedestal turned to ring signatures to elevate their currencies to higher levels of confidentiality.
A brief history of ring signatures
Ring signatures were invented back in 2001, way before cryptocurrencies were conceptualized. The signatures are a form of group signatures that allegedly leave no path to identify the real signer of a ring signature transaction.
Like all things related to cryptography, ring signatures were invented to leak or send secret messages/information, without actually identifying the signer of the message. High ranking government officials used varying levels of the signature for a few years before a couple of loop-holes were discovered in the theory.
Defining a ring signature – What is it?
The basic principle of ring signatures is that they obscure the original input from the sender so that it is computationally impossible to discover who the sender is.
Let us assume that ‘N’ is the number of people that form a network, and that they want to send each other secret messages. Each member of the network has a private key (X) and a public key (Y). The party ‘1N’ that wants to send the message ‘M’ computes the ring signature ‘R’ by using the input (M, X1N, Y1-YN).
Once properly computed, the receiver can input his public key, Y1-YN to unlock the message; he/she would never know who the sender was unless the sender wanted to reveal themselves.
It is interesting to note that only a member of the network with a private key will be able to generate the message and only the focused receiver will be able to receive the message.
Let us assume a network of 10 members. In order to encrypt a message, the signer will use his private key and the public keys of the all the other 9 members; thus resulting in 10 different signatures of which 9 are decoy signatures. To an outside eye, all the signatures would look alike. This means that although every member in the network can view the encrypted message, only the intended receiver can decrypt the message sent.
So, what are the loop-holes in the ring signature algorithm?
Now, a problem arises when the ring signature is double spent. No clause in the original theory stops a person from generating multiple messages. The signature is not for one time use like an OTP (One Time Password); it can be used as many times as the members of the group require.
When the ring signature is used in currencies or for e-voting, there is no way of knowing if the transaction is a double-payment or if the same vote has been cast twice.
How cryptocurrencies benefit from the ring signature
Cryptocurrencies today have combated this drawback by creating linkable anonymity; the message or transaction from a sender can be verified without disclosing the identity of the sender. However, if the same sender or the same message is double-spent (for lack of a better term), the message or transaction is immediately nullified, all the while protecting the identity of the sender.
Linkable anonymity removes the possibility of double-spending in mining operations. The transaction will be confirmed only through a secure process (mining) with no possibility of duplicity.
One of the most famous cryptocurrencies to use ring signatures is Monero. Monero uses a linkable ring signature variant known as the Ring Confidential Transactions or the RingCT protocol.
The mainstream adoption of cryptocurrencies will increase the demand for privacy and confidentiality-focal networks. Ring signatures are just venturing into cryptocurrency platforms; the future may hold innovative partnerships.
Are you a cryptography buff as well? Do you want to know more about the intricacies of the ring signature? Comment below for a follow-up blog.