French cryptography firm Zama has raised US$57 million in a series B funding round co-led by Blockchange Ventures and Pantera Capital.

This funding increases Zama’s total capital raised to over US$150 million, elevating its valuation to above US$1 billion.

Founded by Dr. Pascal Paillier and Dr. Rand Hindi, Zama specializes in fully homomorphic encryption (FHE) technology.

The funding announcement coincides with the launch of Zama’s Confidential Blockchain Protocol and its public testnet.

FHE allows computations on encrypted data without the need for decryption. This enhances security for applications in cloud computing and blockchain financial systems.

This protocol enables developers to create confidential decentralized applications (dApps) on Ethereum.

The company has plans to support additional blockchain platforms by 2026.

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🔗 Source: Tech.eu

🧠 Food for thought

1️⃣ FHE’s four-decade journey from theoretical concept to practical application

Fully Homomorphic Encryption represents one of the longest journeys from theoretical concept to commercial application in modern cryptography.

The concept was first proposed in 1978 by Rivest, Adleman, and Dertouzos, but practical implementation remained elusive for decades as researchers struggled to create systems that could support both addition and multiplication operations on encrypted data1.

Early implementations were limited to supporting only one operation (either addition or multiplication), making them inadequate for complex real-world applications despite their theoretical promise1.

The technology has overcome significant performance barriers, with Zama claiming their FHE implementation is now 100 times faster than at launch, enabling practical applications that were previously impossible.

This development pattern is similar to other foundational technologies like public key cryptography, which also took decades to move from academic concept to widespread implementation, showing how revolutionary cryptographic advances often require extended maturation periods.

2️⃣ Privacy technology evolving from theoretical protection to industry-specific solutions

FHE is increasingly being tailored to address privacy challenges in specific industries rather than serving as a generic security solution.

In healthcare, homomorphic encryption enables secure analysis of cardiovascular disease data and collaborative cancer treatment studies while maintaining patient privacy and regulatory compliance with standards like HIPAA2.

For financial services, the technology unlocks confidential stablecoin transactions in a market valued at $225 billion, allowing financial institutions to maintain privacy while still enabling regulatory oversight3.

The ability to perform complex computations on encrypted data without decryption addresses a fundamental paradox in data analytics: how to extract value from sensitive information without exposing it to security risks.

This shift toward industry-specific applications represents a maturation of privacy technology from theoretical protection to practical solutions addressing concrete business challenges.

3️⃣ Performance remains the critical adoption barrier despite significant progress

Despite substantial improvements, FHE’s computational demands continue to present adoption challenges across industries.

Current implementations require significant computational resources, with operations on encrypted data being considerably slower than those on unencrypted data, necessitating Zama’s development of dedicated hardware solutions to achieve practical transaction speeds4.

The performance gap explains why Zama is pursuing GPU acceleration to handle hundreds of transactions per second today while simultaneously developing specialized hardware chips to reach tens of thousands of transactions in the future.

Technical limitations have historically restricted FHE to research environments rather than production systems, with companies facing a trade-off between security and performance that has slowed mainstream adoption5.

This pattern of hardware specialization is similar to previous cryptographic technologies like SSL/TLS, which also required dedicated acceleration hardware before becoming ubiquitous, suggesting FHE may follow a similar adoption curve as performance improvements continue.

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