Understand better and in a simple way how bulletproofs work.
Bulletproofs are zero-knowledge proofs, which allow a prover to demonstrate to a verifier the validity of a statement without revealing any information beyond the statement's validity. They are used in the context of confidential transactions in cryptocurrencies, such as Monero.
In a bulletproof, the prover commits to a set of values and then proves that these values lie within a certain range without revealing the actual values. This allows for the efficient verification of transactions without revealing the amounts being transferred. The proof size is constant, regardless of the number of values being proved, making bulletproofs highly efficient.
In the context of blockchains, bulletproofs can be used to validate the authenticity of transactions without revealing any confidential information, such as the amounts being transferred.
A transaction in a blockchain network typically consists of inputs and outputs. When a user wants to send some funds to another user, they create a transaction that references one or more unspent inputs and specify the desired outputs. In a confidential transaction, the amounts being transferred are hidden using cryptographic commitments and zero-knowledge proofs.
The prover generates a bulletproof to demonstrate that the sum of the inputs is equal to the sum of the outputs without revealing the actual amounts. The verifier can then check the validity of the proof to ensure that no new funds are being created and that the transaction is valid.
By using bulletproofs, it is possible to increase the privacy of transactions in a blockchain network. The prover can demonstrate the authenticity of a transaction without revealing the actual amounts being transferred, which enhances the privacy of users and reduces the risk of theft or fraud.