Polygon Nightfall is a one-of-a-kind, privacy-focused Rollup that combines Optimistic Rollups with Zero-Knowledge (ZK) cryptography commonly used in ZK-Rollups. It creates a scalable and private hybrid of the two popular technologies.

The Polygon Nightfall Webinar, which took place earlier this month, delved into topics including what Polygon offers, its collaboration with EY, and why Nightfall is the perfect solution for enterprises. At the online event, Polygon’s co-founder Sandeep Nailwal, EY Global Blockchain Leader Paul Brody, and Head of Global Blockchain R&D, Duncan Westland, discussed details about Nightfall. Polygon VP of Strategy Ravikant Agrawal moderated the discussion. We have put together key highlights from the event below.

Clockwise from top left: Sandeep Nailwal of Polygon, Duncan Westland of EY, Paul Brody of EY, and Ravikant Agrawal of Polygon.

Scaling Solutions Across the Spectrum

The first section focused on Polygon’s scaling solutions and how Polygon Nightfall fit in the context of the entire suite of solutions. Nightfall 3 enables conducting payments and transactions at a low cost.

1. Polygon offers a spectrum of scaling solutions. Polygon could often be conflated with only one kind of solution, but Polygon offers a range of solutions with various benefits to each method, depending on the needs of the users. On one end of the spectrum, Polygon SDK is a sovereign chain that is compatible with Ethereum. On the other end, Polygon Hermez is a decentralized zkRollup that inherits its security from Ethereum Layer 1.

2. Private transactions can be done while preserving the benefits of public blockchains for enterprises. With centralized blockchains, operators can observe transactions that are placed on the blockchain. EY set out to find solutions to harness the benefits of decentralization while enabling private transfers and payments. Privacy for enterprise users, Zero-Knowledge Proofs provide the passport for scaling and privacy.

3. Nightfall 3 is the most cost-efficient way of conducting transactions for enterprises. The solution has an optimism layer that enables other actors to check for errors and submit fraud proofs. Utilizing ZK proof for privacy and optimism for scalability, Nightfall 3 allows payment and transactions performed at a low cost.

EY’s Duncan explained where Nightfall fits in different types of scaling solutions

Business Values Nightfall Offers

The second section consisted of a deep dive into the specific applications of Polygon Nightfall. The speakers discussed the outlook for enterprise demand and the need for enterprise blockchains to strike a balance between privacy and compliance.

1. Areas where Nightfall can bring value include product traceability and data synchronization. While it can be beneficial for blockchains to remain transparent, enterprises and institutional investors prefer some level of privacy.  Given the privacy feature Nightfall provides, it can add values in on-chain supply-chain traceability as an operational tool and other business logic such as data synchronization. Sandeep pointed out that over the next 12 to 18 months, a wave of demand from enterprises will be coming to the space.

2. Ways to be legally compliant while meeting privacy needs. EY and Polygon seek to help companies maintain privacy from their competitors while making their solutions lawfully compliant. It can be done by a combination of KYC, whitelisting, and audit using blockchain reconciler tools. Specifically, when someone performs a ZKP transaction, they perform proof that they are on the whitelist. This way, businesses can maintain privacy and KYC at the same time.

3. Nightfall will come with all the benefits of the Ethereum blockchain.  Nightfall can support token-based transfers. It is entirely ERC-20 and ERC-721 compatible. Nightfall can also enable swaps in conjunction with KYC capabilities.

EY’s Paul concluded the discussions that EY and Polygon will continue to improve Nightfall by focusing on scalability with privacy going forward.

Check out the Q&A here. And learn more about Polygon Nightfall here.

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