Zero-knowledge proofs (ZKPs) are no longer confined to research labs and academic cryptography papers. Across Europe, financial institutions, identity providers and regulators are starting to treat them as usable infrastructure rather than an interesting future concept. In the Netherlands and the wider EU, where data minimisation is both a legal obligation and a real business advantage, the timing is especially good.
Why ZKPs Matter Right Now
The demand for data sharing keeps increasing. Open banking mandates across Europe require banks to make customer data available to third-party providers, while GDPR says institutions should collect only what they genuinely need. Those pressures point in opposite directions, and that is exactly where ZKPs become useful.
A zero-knowledge proof lets one party prove something is true without handing over the underlying data. A bank can confirm that a customer earns above a required threshold without revealing the exact salary. An identity provider can verify that someone is over a certain age without sending a full birth date. The cryptography behind this is complicated, but the business case is easy to grasp.
Seven Use Cases Worth Watching
- KYC and AML Compliance
Traditional Know Your Customer processes usually involve passing raw identity documents between multiple institutions. With ZKPs, a verified credential can move from one party to another while the original sensitive document remains with the issuer. Dutch banks testing this model have already reported noticeable reductions in duplicate data across their compliance systems.
- Credit Scoring Without Data Exposure
A lender does not need to inspect every individual transaction to decide whether a borrower is creditworthy. ZKP-based credit attestations make it possible for a scoring model to run on encrypted data and send back only a pass/fail outcome to the lender.
- Cross-Border Payment Verification
Correspondent banking comes with heavy counterparty verification requirements. ZKPs can prove that sanctions screening has been completed without revealing which lists were checked or which specific data points triggered extra review. For institutions working across several jurisdictions, that could remove a lot of operational friction.
- Privacy-Preserving Digital Payments
Payments are one of the clearest areas where ZKP adoption is starting to become visible to end users. Digital wallets and instant payment rails are beginning to use proof systems that validate transactions without exposing account balances. That matters even more in markets where privacy-enhancing technologies (PETs) are drawing regulatory interest, including through the European Banking Authority’s ongoing work on data minimisation frameworks. The iDEAL payment system, widely used across the Netherlands, is a useful reference here. Its architecture supports digital transactions across retail, subscriptions and entertainment. An iDEAL casino platform, for example, handles deposits through the same trusted infrastructure Dutch consumers use every day for e-commerce, showing how payment verification standards developed in banking can extend directly into adjacent digital markets.
- Employee Credential Verification
HR platforms in the Netherlands are also looking at ZKP-backed attestations that confirm professional qualifications without exposing an employee’s full CV to every hiring platform. A candidate could prove they hold a particular degree without revealing the institution, graduation year or unrelated credentials.
- Decentralised Identity Onboarding
This may be the most important near-term application of the lot. Decentralised identifiers based on W3C DID standards give individuals cryptographic control over their identity data. ZKPs make selective disclosure possible, so people share only what a specific interaction actually requires. For Dutch fintech platforms bringing on new users, that mix can reduce onboarding friction while supporting GDPR’s data minimisation principle at the technical level.
- Regulatory Reporting
Banks are required to send detailed reports to De Nederlandsche Bank and the ECB. ZKP-based reporting frameworks would allow institutions to prove aggregate compliance metrics such as capital ratios and exposure thresholds without sending the granular transaction-level data that regulators currently receive. Pilot programmes in this area are expected to approach production readiness by late 2026.
What Is Actually Deployable in 2026
The practical rollout timeline for these use cases falls into two broad groups:
- Near-term (2025–2026): KYC credential sharing, digital payment verification and employee credentialing. These have the advantage of existing cryptographic libraries, a relatively contained integration scope and clear regulatory demand.
- Medium-term (2026–2027): Decentralised identity at scale, cross-border AML proof systems and regulatory reporting. These depend on wider ecosystem coordination and standardisation work that is still underway.
The infrastructure gap is closing faster than many expected even two years ago. Proof generation times have improved sharply with hardware acceleration, and frameworks such as zkSync and StarkNet have already shown that ZKPs can run at transaction speeds that matter in financial services.
The Broader Shift
What makes this phase different from earlier rounds of ZKP hype is that regulation is moving in the same direction as the technology. The European Banking Authority’s focus on privacy-enhancing technologies, together with the eIDAS 2.0 framework for digital identity wallets, has created a policy environment in which ZKP adoption is not only technically realistic but institutionally encouraged. For Dutch financial institutions trying to balance innovation pressure with compliance complexity, that kind of alignment is rare, and it may not stay open forever.
