The blockchain industry is continuously evolving and giving rise to new and complex requirements. As the usage of blockchain increases, businesses are faced with the need for data privacy. In response to this, Fhenix, a new blockchain that focuses on data confidentiality, has completed a seven-figure seed round, raising $7 million.
Led by Multicoin Capital and Collider Ventures, the funding round attracted participation from Node Capital, Bankless, HackVC, TaneLabs, Metaplanet, and Robot Ventures. The funds will be used to prepare the Fhenix Network public testnet for an early 2024 launch and support application development for the ecosystem.
Fhenix aims to achieve data privacy on the blockchain by utilizing a cryptographic technique called fully-homomorphic encryption (FHE) in smart contracts. FHE allows for direct computation over encrypted data without revealing the underlying data. In simpler terms, it enables the processing of encrypted data without decrypting it first. This technology empowers blockchains to perform computations on user data without compromising privacy.
By integrating the FHE protocol developed by Zama, Fhenix can keep transaction amounts encrypted, ensuring that only the parties involved can see how much money is being sent. The partnership with Zama allows Fhenix to seamlessly integrate FHE into its blockchain, enabling developers to create encrypted smart contracts without requiring cryptographic expertise.
The potential use cases for Fhenix’s FHE-supported blockchain are extensive. It can be utilized in confidential transactions, privacy-friendly data analytics, on-chain trustless gaming, private voting for decentralized autonomous organizations (DAOs), and on-chain privacy-preserving artificial intelligence (AI).
Fhenix’s founder, Guy Zyskind, who is also the founder of the Secret Network, highlighted the need for encryption for commercially sensitive data on Ethereum. With Fhenix, users can confidently put sensitive data on public blockchains, and developers have the tools to compute and transform that data securely.
CEO Guy Itzhaki, a former director at Intel’s Homomorphic Encryption and Blockchain Division, emphasized the empowerment of developers through encrypted smart contracts, enabling new business opportunities. Fhenix’s future plans include launching its public testnet, called Renaissance, in the first half of 2024. This testnet will serve as a sandbox environment for decentralized application developers looking to benefit from the confidentiality introduced by FHE cryptography.
While zero-knowledge proofs (ZK proofs) are often associated with privacy on the blockchain, FHE is not a direct replacement for ZK proofs. Both technologies focus on different aspects of blockchain privacy and can be used together to meet the diverse privacy needs of the blockchain ecosystem.
As the blockchain industry continues to evolve, Fhenix’s innovative approach to data confidentiality through fully-homomorphic encryption holds promise for businesses seeking enhanced privacy and security on the blockchain. With its upcoming public testnet and continuous development, Fhenix aims to become a pioneer in the field of confidential blockchains.
