# Tech Architecture

### **Hierarchical Deterministic Wallets**

Hierarchical Deterministic Wallet (HD Wallet) is a cryptocurrency wallet management method that allows users to generate a series of associated key pairs from a master key (or seed key). The master key generates a root node (or master node), from which multiple child nodes can be derived, and each child node can further derive its own sub-nodes.

HD wallets are deterministic, meaning that all sub-keys can be generated from a single seed key (usually a randomly generated string or mnemonic phrase). This makes backup and recovery very simple: by backing up just one seed key, the entire wallet can be restored. Moreover, the hierarchical structure of HD wallets ensures security: even if a child key is compromised, it cannot be used to infer other sub-keys or the master key.

The DDC wallet leverages HD wallet technology to ensure that each transaction uses a unique address. By deriving addresses from the root node, users can securely and conveniently manage their on-chain assets.

### **ZK Data Marketplace**

Overview of a zero-knowledge (ZK) proof-based data marketplace, where users can securely trade their data without compromising privacy.

The ZK Data Marketplace is a core element of DDC’s operations. Its main features are as follows:

* Users can upload their data to the blockchain, and this data is protected by privacy measures. Although the data is on-chain, it is encrypted and cannot be accessed by third parties. Additionally, data is only uploaded at the user’s discretion.
* While on-chain data remains privacy-protected, it can still be traded. Purchasers who have paid for the data will only receive enough information relevant to their own business needs.
* All of the above information is verifiable.

### **Privacy Techniques**

Detailed explanation of Trusted Execution Environments (TEE), Multi-Party Computation (MPC), and Zero-Knowledge (ZK) proofs.

#### TEE

Trusted Execution Environments (TEE) are a security technology designed to protect sensitive data and code within computing devices. This technology has become increasingly common in modern computing devices, especially in mobile devices and servers. The primary purpose of TEE is to provide an isolated execution environment that protects sensitive data and critical applications from attacks by the operating system and other untrusted applications. Its main features include isolation and trusted boot.

* Isolation means separating sensitive data and code from the regular operating system. This ensures that even if the operating system is compromised, the sensitive data and applications remain secure.
* Trusted Boot ensures that the system has not been tampered with from startup through operation. By using a Hardware Root of Trust, TEE can verify each stage of the boot process.

DDC employs TEE technology to address digital rights management, encryption key management, and other related processes.

#### MPC

Multi-Party Computation (MPC) is a cryptographic technique designed to allow multiple participants to collaboratively compute the output of a function without revealing their individual input data. This technology is significant for maintaining data privacy and security. Specifically, each participant retains the privacy of their input data while ultimately obtaining a result through collaborative computation without disclosing their respective data.

DDC utilizes MPC technology for privacy-preserving statistical analysis. Without disclosing any participant’s data, DDC performs statistical analysis on the data, and the results can serve as a data source for AI analysis.

#### Zero-Knowledge (ZK)&#x20;

Zero-Knowledge Proof (ZKP) is a cryptographic technique that allows one party (the prover) to demonstrate to another party (the verifier) that a statement is true without revealing any additional information related to that statement. In other words, the verifier can confirm the truth of the statement without obtaining any information necessary to prove it.

ZK Proof technology is the cornerstone of various data packages in the DDC data marketplace. These data packages are subject to strict privacy protection while still requiring transactions, and the underlying principle used is ZK Proof technology.

### **Layer2 on Ethereum**

DataDance’s Ethereum Layer2 structure to support the solution’s scalability and privacy requirements.

DataDance Chain (hereinafter referred to as DDC) is a Layer 2 blockchain. Based on HD key derivation technology, the chain-level precompiled contracts ensure the secure exchange of keys.

#### Wallet

In addition to executing signed transactions, the DDC wallet can also view various types of assets. Each type of asset belongs to a different address, but all are owned by a root address. The wallet derives a sufficient number of child addresses and interacts with the DDC chain, using precompiled contracts for key exchange.

When a user becomes a customer of a particular brand, in other words, when they claim an NFT from that brand, the wallet will derive enough child addresses and encrypt them using the brand’s public key (RSA?). These child addresses can only be decrypted by the brand. When the brand airdrops other assets, these child addresses can be utilized.

#### DataDanceChain

The operating nodes of DDC’s VM can perform key exchanges with the wallet, and the precompiled contracts use RSA for data encryption and decryption.

#### DataDanceChain Explorer

In addition to the standard features of a public blockchain explorer, DDC’s blockchain explorer also includes numerous privacy protection functions and tools to help users manage their data.&#x20;

For instance, it helps conceal users’ real blockchain addresses from the NFT airdrop lists of brands.&#x20;

More features are currently in development, so stay tuned for updates.

