Aleo is a platform for fully private applications. It uses zero-knowledge proofs to enable private transactions and private data on public blockchains. Aleo applications are built using a new programming language called Leo, which is similar to Solidity but with added support for zero-knowledge proofs. Aleo is indeed a revolutionary platform for crafting fully private applications. Its core functionality is hinged on the utilization of zero-knowledge proofs (ZKPs), a cryptographic protocol that validates the authenticity of transactions without revealing any specifics. This technique, in essence, allows for the orchestration of private transactions and the preservation of private data on public blockchains.

Aleo’s foundation is constructed on the bedrock of key research documents. These scholarly papers serve as the deep wells of knowledge, offering profound insights that shape Aleo’s ongoing developmental strategies and projects. They are publicly accessible, acting as a reservoir of information for those who wish to delve into the complexities of the team’s work:

Whitepapers

  1. Zexe: Enabling Decentralized Private Computation: Zexe, as delineated in the research paper, pioneers a system for decentralized private computation, drawing heavily from the bedrock principles of zero-knowledge proof systems. This system, analogous to the functional command or opcode in Aleo instructions, offers a low-level but indispensable functionality pivotal to the system’s operation.1

  2. POSEIDON: A New Hash Function for Zero-Knowledge Proof Systems (Updated Version): The research paper unveils POSEIDON, a hash function underpinned by HADES, and navigates through its tangible applications, cryptanalysis results, and performance estimates in zero-knowledge proof systems. It further provides concrete instances with round numbers and domain constants, offering a comprehensive understanding of the function’s practical applications.2

  3. Marlin: Preprocessing zkSNARKs with Universal and Updatable SRS: The Marlin paper delves into the intricacies of preprocessing zkSNARKs, a type of zero-knowledge proof system, with a universal and updatable structured reference string (SRS). The universal and updatable nature of the SRS in Marlin offers an advanced level of flexibility and adaptability, much like the evolution from assembly to more expressive languages in programming.3

  4. Proof of Necessary Work: Succinct State Verification with Fairness Guarantees: This research paper introduces a novel concept that combines succinct state verification with fairness guarantees. This system, much like the Marlin and POSEIDON systems, is reliant on key concepts that operate much like assembly, providing a low level but critical functionality.4

  5. LEO: A Programming Language for Formally Verified, Zero-Knowledge Applications: The research paper introduces LEO, a programming language designed specifically for zero-knowledge applications. LEO supports a variety of zkSNARK proof systems, as long as the zkSNARK language supports R1CS relations, showcasing its versatility and adaptability, making it a powerful tool in the development of zero-knowledge applications.5

The Researchers’ Backgrounds

In the realm of zero-knowledge proofs and their applications, the authors of the papers I’ve referred to are esteemed contributors with a diverse array of backgrounds.

The authors of the Zexe paper are recognized for their extensive work in the field of cryptography. Benedikt Bunz, a Ph.D. candidate at Stanford University, is known for his work on Bulletproofs, a non-interactive zero-knowledge proof protocol. Alessandro Chiesa, an Associate Professor at UC Berkeley, has made significant contributions to the theory and practice of zero-knowledge proofs. Pratyush Mishra, a Ph.D. student at UC Berkeley, has worked on various aspects of cryptography and security, and his research includes the development of new cryptographic protocols and the exploration of their applications.

The Poseidon paper was authored by a team of researchers from the DFINITY Foundation, a not-for-profit scientific research organization. They have a strong background in cryptography and computer science, with a focus on designing secure and efficient protocols for decentralized systems.

The Marlin paper was authored by a team of researchers from the University of California, Berkeley, and the DFINITY Foundation. Their backgrounds span across cryptography, computer science, and mathematics, with a focus on designing and analyzing cryptographic protocols and systems.

The research paper on LEO, a novel programming language, was meticulously crafted by a group of experts from Aleo Systems Inc. This team, composed of computer scientists, engineers, and cryptographers, holds a profound comprehension of zero-knowledge proof systems and their practical applications.

Aleo’s Founders

The inception of Aleo Systems Inc. in 2018 was the brainchild of a well-established computer scientist, Howard Wu. Wu’s expertise spans across the realms of cryptography and distributed systems, positioning him as a key player in the blockchain technology landscape. His contributions include the development of a decentralized exchange protocol and a privacy-preserving smart contract platform, demonstrating his commitment to enhancing privacy in the digital world.

Howard’s foray into this field began at UC Berkeley, where he undertook extensive research on key concepts like consensus and decentralization, and developed an in-depth understanding of Ethereum and Solidity

His fascination with zero-knowledge proofs, a concept he stumbled upon in a professor’s bio, led him to work closely with Professor Alessandro Chiesa, co-inventor of Zerocash and co-founder of Zcash and StarkWare. Together, they developed libsnark, the first popular library for zkSNARKs (in C++). This collaboration further solidified Howard’s status as a leading figure in the field of zero-knowledge proofs.

Howard’s journey didn’t stop there. After spending a year at Google, he returned to Berkeley to pursue his masters in Electrical Engineering and Computer Sciences, specializing in zero-knowledge proofs. His relentless pursuit of knowledge and innovation, combined with his natural ability, led to his recognition as “One of the leading lights of ZKs” by Daniel Jacobs of Kora Management]^1].

Howard’s contributions to the crypto space extend beyond academia. He has made significant strides in the industry, most notably with Aleo. He found a like-minded partner in Alex Pruden, who joined Aleo as Chief Strategy Officer and later became COO and eventually CEO. Together, they are working to make the internet ready for zero-knowledge proofs, a vision that has the potential to revolutionize the way we interact with data and privacy online.

Howard’s story is a testament to the power of passion, dedication, and a relentless pursuit of knowledge. His contributions to the crypto space, particularly in the realm of zero-knowledge proofs, are making waves in the industry and paving the way for a more secure and privacy-centric internet.

Compared to Bitcoin

A comparison between Aleo and Bitcoin can be established on several key concepts. Aleo and Bitcoin, while both being blockchains, differ significantly in their architecture and functionality.

Bitcoin, the pioneering blockchain, operates on a simple and robust proof-of-work consensus mechanism. Its primary function is to serve as a decentralized digital currency, reliant on a ledger and a UTXO (unspent transaction output) model. In this model, inputs specify the origin of an asset, and outputs denote the destination, with a value representing the quantity of the asset being transferred6.

Aleo, on the other hand, is a newer, more advanced blockchain that integrates zero-knowledge proofs to facilitate the development of private-by-default applications6. It employs a Bitcoin-like architecture with a ledger and a UTXO model but introduces a unique consensus algorithm, AleoBFT, which combines elements of proof-of-work and other key differences6 commonly referred to as proof-of-succint-work.

Proof of Succinct Work (PoSW) is an innovative concept that forms the crux of Aleo’s original consensus algorithm, particularly relevant in the current Testnet 3 phase before Aleo transitions to Mainnet6. Unlike traditional Proof of Work (PoW) systems, PoSW is designed to make the computational work performed useful, rather than just grinding SHA-2566. PoSW is a subset of the broader concept of Proof of Necessary Work (PoNW), proposed by Assimakis Katis and Joe Bonneau in 2020, where proof generation is an integral part of the proof-of-work used in Nakamoto consensus, thereby effectively producing proofs using energy that would otherwise be wasted4. This approach, combined with Proof of Stake (PoS), forms the basis of AleoBFT, designed to secure the protocol, ensure that there is broad prover participation, and keep costs manageable6.

Unlike Bitcoin, which operates on a “winner-takes-all” dynamic, Aleo accepts multiple valid solutions per block, distributing rewards to more provers and thereby fostering decentralization6. Aleo’s strategy of commoditizing its zkSNARK proving complement, through AleoBFT and ZPrize, is a significant step towards mitigating the risk of one prover dominating the system, which could potentially compromise the security of the underlying protocol6.

Compared to Ethereum

Aleo, has been compared to Ethereum in several ways, yet it distinctly stands alone in its approach. Aleo was initially conceived as an L2 on Ethereum, but due to the limitations with ZKPs on Ethereum, the team decided to build its own L1 to deliver cheaper ZKPs6.

In terms of smart contracts, Aleo’s smart contracts won’t be Ethereum Virtual Machine-compatible. Instead, a new smart contracts programming language called “Leo” replaces Solidity, the preferred language for Ethereum developers7. This decision to develop its own language and VM is a bold one, considering the strong gravity of the Ethereum ecosystem, which hosts many of the most popular protocols and applications written to the EVM6.

Aleo’s unique approach to privacy is another differentiating factor. Aleo promotes privacy-focused DeFi programmability, drawing from the same privacy technology that underpins Zcash, a privacy-focused transaction platform. This has led to the analogy of Aleo being “Zcash with smart contracts”7

While Ethereum’s on-chain computations slow down its network, Aleo plans to offer more “scalability, efficiency, and privacy” by executing programs off-chain7. Aleo’s unique architecture, which uses a Bitcoin-like model, combines a ledger and a record or UTXO (unspent transaction output) model6.

Compared to Zcash

Aleo, in its essence, is akin to a hybrid of Ethereum and Zcash. This comparison encapsulates the primary functions and objectives of Aleo: to offer a platform that combines the smart contract capabilities of Ethereum with the privacy-focused transaction model of Zcash7.

While Zcash excels in providing privacy for transactions, it lacks the advanced programmability that Ethereum offers. Aleo, however, has taken the best of both worlds and created a platform that not only ensures privacy but also supports DeFi programmability. An alternative analogy to understand Aleo would be to consider it as “Zcash with smart contracts”7.

Aleo’s privacy technology is derived from the same zero-knowledge proofs (ZKPs) that underpin Zcash. These ZKPs allow for the verification of information without revealing the information itself, thus ensuring privacy. Aleo has taken this technology and integrated it with the functionality of smart contracts, creating a unique and innovative platform for decentralized applications7.

Programmability of Ethereum, Privacy of Zcash, and Soundness of Bitcoin

The landscape of blockchain technology presents a spectrum of capabilities, each with its unique strengths and weaknesses. On one end, we have Bitcoin, lauded for its soundness yet lacking in programmability and privacy. Ethereum, on the other hand, offers high programmability but compromises on privacy. Zcash fills the privacy void but falls short in programmability. The elusive sweet spot – a blockchain offering high privacy and high programmability – has remained largely unoccupied. This gap is precisely where Aleo spotted an opportunity6.

Aleo, a protocol built on the Zexe framework, aims to bring together the best of these worlds. It leverages the power of zero-knowledge proofs (ZKPs), a cryptographic method that allows one party to prove to another that they know a value x, without conveying any information apart from the fact they know the value x. This technology underpins the privacy of Zcash and has the potential to reshape the entire internet8.

The need for privacy in blockchain technology is paramount. Traditional ledger-based payment systems like Bitcoin and Ethereum reveal the sender, receiver, and amount in every transaction. This not only exposes private financial details but also violates fungibility, a fundamental economic property of money1. Aleo seeks to address these privacy concerns, offering a platform where applications are private by default6.

However, privacy is just one side of the coin. Programmability is equally crucial in the blockchain environment. Ethereum, a next-generation smart contract and decentralized application platform, has made significant strides in this area4. Aleo aims to bring this level of programmability to its protocol while maintaining privacy. Aleo’s CEO, Alex Pruden, encapsulates this vision, stating, “Everything you can do on Ethereum, you can do in Aleo, but privately”9.

Aleo’s ambition is not without challenges. The cost of verifying proof on-chain can be high due to the lack of SNARK-friendly hash functions, elliptic curves, and other primitives on Ethereum6. However, the pace of innovation in Web3 and ZK specifically is accelerating, thanks to the infusion of talent and capital into the space10.

In conclusion, Aleo represents a promising venture in the blockchain landscape, merging the soundness of Bitcoin, the programmability of Ethereum, and the privacy of Zcash. This fusion could potentially reshape the internet, providing users with experiences that are truly private while giving service providers the right information to serve them well6.

  1. Zexe: Enabling Decentralized Private Computation ↩ ↩2

  2. POSEIDON: A New Hash Function for Zero-Knowledge Proof Systems (Updated Version) ↩

  3. Marlin: Preprocessing zkSNARKs with Universal and Updatable SRS ↩

  4. Proof of Necessary Work: Succinct State Verification with Fairness Guarantees ↩ ↩2 ↩3

  5. LEO: A Programming Language for Formally Verified, Zero-Knowledge Applications ↩

  6. Aleo: Can You Keep a Secret? ↩ ↩2 ↩3 ↩4 ↩5 ↩6 ↩7 ↩8 ↩9 ↩10 ↩11 ↩12 ↩13 ↩14 ↩15

  7. Aleo Blockchain Raises $200M for Privacy-Minded DeFi ↩ ↩2 ↩3 ↩4 ↩5 ↩6

  8. ZK-proofs could change the internet, not just Web3 — Aleo exec ↩

  9. Privacy-focused Aleo blockchain gets new wallet as mainnet launch approaches ↩

  10. Like Mining and Validation, Proving Needs To Be Decentralized ↩