Zama, a groundbreaking cryptography startup dedicated to enhancing privacy on public blockchains, has secured $57 million in Series B funding led by Pantera Capital and Blockchange Ventures. This funding round has propelled Zama’s valuation to over $1 billion, marking it as the first company in advanced encryption to achieve unicorn status.
Launched in 2020, Zama aims to introduce privacy to public blockchains while maintaining transparency and auditability. The recent funding coincides with the unveiling of Zama’s public testnet and “confidential” blockchain protocol, enabling developers to construct encrypted smart contracts and decentralized applications.
“Our primary focus is on financial applications, particularly payments,” stated Zama CEO Rand Hindi in an interview with Decrypt. “Our conversations with stablecoin issuers and users have shown a strong demand for confidentiality in on-chain payments.”
While encryption is fundamental to the blockchain industry, homomorphic encryption allows for data encryption that can be processed without decryption. This technology enables the issuance of cryptocurrencies, stablecoins, and payment processing on public blockchains without exposing transaction details to the public.
Fully homomorphic encryption (FHE) enables the recomputation of data states using encrypted data, providing a high level of public verifiability while maintaining data confidentiality. Hindi explained, “FHE is the only confidentiality technology that combines security with public verifiability.”
Zama is set to launch on the Ethereum network in July before expanding to other Ethereum Virtual Machine-enabled blockchains. Hindi highlighted Ethereum as the primary choice due to its prevalence in stablecoin issuance, with plans to swiftly transition to other EVM chains.
Regarding Solana, Zama aims to integrate with the platform by 2026 through a phased approach. “Adapting our technology to Solana’s SVM and meeting performance expectations are key steps before launching on Solana,” Hindi explained.
Unlike controversial privacy tools such as coin mixers, Zama’s approach focuses on encrypting content while maintaining transaction visibility. “FHE conceals on-chain data, not transaction traces, enabling traceability back to KYC-compliant wallets if necessary,” Hindi emphasized.
One of Zama’s key features is “programmable confidentiality,” granting developers control over data decryption within smart contracts. This flexibility allows for tailored compliance rules to be implemented by developers.
Hindi believes that the combination of performance improvements and confidentiality solutions paves the way for widespread adoption of blockchain technology, particularly in financial applications.
Reflecting on Zama’s journey to unicorn status, Hindi expressed satisfaction in seeing a growing interest in confidentiality from investors and builders. “It’s a battle I’ve been fighting for over a decade,” he shared.
Edited by Andrew Hayward