SCP Ventures Investment Notes - Mind Network article
On June 29, Mind Network, which focuses on Fully Homomorphic Encryption (FHE), announced that it had raised $2.5 million in seed funding from Binance, HashKey, SevenX Ventures, and others.
Prior to this, Mind Network also made it into the fifth season of Binance Incubator and was the only data-related project selected in this round. Achieving this milestone was particularly remarkable in the bear market.
Similar to the Mind Network's "Zero Trust" mechanism, the concept of zero trust between each other can also facilitate the secure operation of the network, without the need for a third party or centralized institutions to provide authoritative endorsement. This feature holds special significance for the current blockchain in its journey back to encrypted privacy,
This expression may seem abrupt. In the perception of Web3 practitioners, encrypted networks are inherently anti-authority and decentralized, but this comes at a cost:
One of the costs is the public transparency of on-chain data, which has led to the emergence of industry leaders like mining based on data has also created industry leaders such as Nansen, Dune, 0xScope, etc., and the movement of whales can be monitored in 7X24 real-time, causing ripples in the market.
The second cost is the increasing complexity of various public chains. Blockchains need to store historical data to ensure consensus and need to scale to accommodate more complex use cases. Striking a delicate balance between consensus and efficiency poses challenges.
Ultimately, these challenges point to the lack of a universal privacy layer. Blockchain can protect user privacy without hindering the transparency of on-chain data, and can also decouple the privacy protection and on-chain execution of various blockchain applications to improve efficiency.
The value of Mind Network can be preserved and appreciated in the process of on-chain circulation. By combining with the permanent storage feature of Arweave, more diverse usage scenarios and dynamic computation will become a reality.
Technical Analysis -- What is the Zero Trust Mechanism
The key concept of Mind Network is the zero trust mechanism, which is more of a definition for the ultimate state the final state that the network can achieve. The opposite of the zero trust mechanism is the commonly used trust authorization mechanism, such as the most typical firewalls and local area networks.
Its operation process involves setting different levels of administrative privileges and controlling the network's accessible range. The benefits are obvious - any external malicious access can be controlled by the administrator until the highest authority administrator takes over any network node.
But the disadvantage is also obvious. If a specific administrator is breached, the whole network may be taken over and exposed to potential leaks.
The zero trust mechanism stems from this and can be outlined based on Cloudflare's definition with the following characteristics:
Continuous monitoring and verification. By default, all nodes are untrusted and need to be verified before granting permissions for a limited time;
Minimum and necessary permissions are granted. Do not add more entities unless it is necessary and avoid granting users permissions beyond their potential usage scope.
Device access control. Registering and monitoring hardware devices that access the network;
Segmenting permissions. Subdividing the permissions of file resources that users can access, and only granting access only within the necessary scope;
Prevention of lateral movement. User permissions cannot be exceeded and are limited to predefined ranges. but can only be exercised within the set range. Any unauthorized actions are recorded and prohibited.
Multi-factor authentication (MFA). Confirming user identity using two or more devices or methods typically via tools such as Google Authenticator.
Slightly differs from traditional Internet scenarios, in the context of blockchain and the Web3 domain, In the Web3 field, network security involves public chains such as L0/L1/L2, DApps, smart contracts, and interactions and calls of various nodes.
In a sense, on-chain security is a zero-sum game. On the one hand, the Mind network needs to encrypt all entities and actions involved with security, which will increase the amount of computational resources required by the network. On the other hand, if any individual or node is out of control, the whole network loses its security.
The choice of Mind Network is to use the modified fully homomorphic encryption (FHE) as its core technology, which encrypts all nodes and behaviors involved in the on-chain interaction to get rid of the potential single-point-of-failure problem.
Specifically, its technical paradigm can be classified as One Center - Fully Homomorphic Encryption, and Two Fundamental Points - Behavior and Entity control.
Partially Homomorphic Encryption (PHE) is a technology paradigm in contrast to Fully homomorphic encryption (FHE), which can only perform addition or multiplication operations each time, with limited security but lower resource consumption. Fully homomorphic encryption can support an arbitrary number of addition or multiplication operations, providing a higher level of security but also requiring increased computational resources.
Adaptive Fully Homomorphic Encryption (AFHE) proposed by Mind Network is a tradeoff between resource consumption and computational capacity aiming to reduce the required computational power while ensuring security as much as possible.
The advantage of AFHE is that the encrypted data is functionally equivalent to the plaintext, so it enables the direct operation of the encrypted data~~,~~ without the need for participating nodes and entities to have knowledge of plaintext.
Entity control is derived from this concept. The main entities on the chain involve at least the sender and receiver, as well as developers and project parties, and the operation of nodes also requires smart contracts and public chain nodes. By embedding Mind Network into each entities, the single point of failure can be completely eliminated. With the improved AFHE, network performance can be maintained without sacrificing speed.
Behavior control involves providing customized service for various classical usage scenarios, which is to set up various behaviors of interaction with users from the blockchain. The current product matrix can be divided into five categories: Mind Lake, Mind Studio, Mind SDK, Mind Scan, and Mind Query.
Mind Lake provides a well-packaged and self-sustaining computing Node called Mind Node, with encryptor, cache, and storage for private, high-performance encrypted computing services. Mind Network allows miners to directly operate on these encrypted inputs, generate encrypted outputs, and update the network state accordingly. It guarantees computation through a Proof-of-Encryption mechanism and can be plugged into other decentralized infrastructures to scale its encrypted computation and storage capabilities.
Mind Studio is an SQL-based integrated development environment for Mind Network. It lets users compute directly on encrypted data using decentralized storage such as Arweave, L1/L2 chain, and cloud platforms like AWS and Alibaba Cloud.
Mind SDK is an SDK toolkit that supports development in multiple programming languages, including Typescript and Python.
Mind Scan is a web browser that allows users to query and access public data.
Mind Query provides access to the core Mind Network.
With the combination of technology and architecture, Mind Network can provide encryption services for any network service, such as encryption for decentralized web pages, even not limited to the Web3 field. It even can provide encryption privacy services for AI to build a more secure AI network.
After unlocking Arweave: Decouple storage and compute
Mind Network excels at computing, but it still has to deal with a lot of data; Arweave, on the other hand, excels at storing large amounts of data but has slower real-time settlement speeds due to its proof-of-work mechanism.
One's meat is another man's poison. Arweave and Mind Network combine each other's strengths to mitigate their own weaknesses. For example, in a classic text-sharing process, there are two alternatives to using Arweave. One is to store it in a traditional database, but there is a centralization problem. The other is stored on a public chain such as Bitcoin, Ethereum or L2, but the cost will still be expensive as the space on-chain is very expensive and limited, which is not a long-term solution.
n this scenario, the process of encryption and decryption can be reconstructed. Arweave specializes in storing cold data, while Mind Network specializes in performing hot computation, Arweave only performs final state confirmation and stores encrypted data. Even if it is made public, under the protection of AFHF, there is no need to worry about the security of the data exposed.
When the data needs to be decrypted, the user only needs to download the required data from the Arweave Network and use Mind Network to decrypt it in the local environment. At this time, the data emains offline, eliminating concerns about data security. no need to worry about data security issues.
The overall process can be summarized as follows:
Alice uploads the data to Mind Network, and after AFHE encryption, the data is stored in Arweave forever.
When Bob needs to use that portion of the data, he sends a request to Alice for permission.
After receiving the permission request, Alice can choose to authorize or deny Bob's request.
If Alice denies the request the process ends. If Alice grants authorization, Bob can decrypt the data locally at this time.
Alice can choose to cancel the authorization at any time. In such case, Bob can only access the decrypted data locally, and cannot decrypt the updated on-chain data.
At the same time, Mind Network will also use Arseeding as a light node service to improve the network upload efficiency. Arseeding can directly support Bundle transactions and EVM-compatible wallets such as Metamask. It can also allow flexible payment of gas fees using various cryptocurrencies, eliminating complex interactive processes.
Furthermore, Arseeding has already enabled real-time retrieval by integrating with KNN3, allowing users to retrieve and access their uploaded data using GraphQL-based tagging. You can even imagine a service that is similar to a traditional online storage-sharing platform, where Alice can set the plaintext title and encrypted content at the same time. Bob can then search for titles and purchase the corresponding data. This opens up possibilities for more advanced creator economic functions such as subscription and distribution.
From the perspective of user experience, Alice only needs to upload data and manage permissions, while Bob only needs to download data and request permissions, and users no longer need to directly interact with the public chain.
“Give back to Ceasar what is Ceasar's and to God what is God's”. By combining Arweave's specialized storage capabilities with Mind Network's specialized computing capabilities, existing network services can be reimplemented in a more efficient and secure way.
Conclusion
SCP Ventures will continue to support the ongoing development and financing of Mind Network after participating in this round of funding. We firmly believe that this will change the way Web3 operates in the future.
However, just like Arweave and Mind Network, have their respective roles, Mind Network can't completely solve the problem of copyright protection. As long as Bob obtains Alice's data, the current version of the data will be stored locally forever. Of course, you can use timestamps or watermarks, but essentially there's nothing anyone can do to prevent the secondary replication of the information.
But the underlying logic of Mind Network remains valid. Humans staying connected to information in the digital age is a new norm, and there is still a place for Mind Network in the storage and management of companies, DAOs, and other organizations!
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