Zama, an open-source cryptography startup aiming to bring complete privacy to public blockchains, has raised $57 million in Series B funding led by Pantera Capital and Blockchange Ventures. The round pushes Zama’s valuation over $1 billion, making it the first company working in advanced encryption to hit unicorn status.
Founded in 2020, Zama seeks to bring privacy to public blockchains without compromising transparency or auditability. Zama’s latest funding comes alongside the launch of its public testnet and “confidential” blockchain protocol, which allows developers to build encrypted smart contracts and decentralized applications.
“We are focusing on financial applications, in particular payments,” Zama CEO Rand Hindi told Decrypt. “It’s clear from all our conversations with both stablecoin issuers and people using stablecoins that they want confidentiality in on-chain payments.”
While encryption is at the center of the blockchain industry, homomorphic encryption allows users to encrypt data that can then be processed without decrypting it, making it possible to issue cryptocurrencies, stablecoins, or process payments on public blockchains without revealing transaction details to the world.
Fully homomorphic encryption, or FHE, “allows you to recompute the state using the encrypted data,” Hindi explained. “This means you have the same level of public verifiability, but without needing to see the actual data, making [it] effectively the only confidentiality technology that is both secure and publicly verifiable.”
Hindi said that Zama will launch first on the Ethereum network in July before moving to other Ethereum Virtual Machine-enabled blockchains.
“We chose Ethereum as it’s the canonical chain where a lot of the stablecoins are issued. So it makes sense to have the confidentiality layer there first,” he said. “Moving from Ethereum to other EVM chains will happen fairly rapidly, as it’s the same stack.”
As for Solana, Hindi said Zama is targeting a 2026 integration utilizing a two-fold approach.
“First, we need to adapt our technology to the SVM and have it audited, which takes time,” Hindi said. “Second, the expectation from Solana developers regarding performance is that they can do hundreds, if not thousands of transactions per second. Once we are able to support Solana speeds, we will launch there.”
Unlike controversial privacy tools like coin mixers, which have been targeted by governments and law enforcement, Hindi said Zama’s approach focuses on encrypted content while keeping the transaction itself visible.
“With Tornado Cash, you make the transaction untraceable, but the content is public,” he said. “FHE, on the other hand, hides the on-chain data, not the transaction trace. You can see who interacted with whom, but you cannot see their balances, amounts, etc. This means you can always trace back the transaction to a KYC’d wallet if needed.”
A key feature in the protocol, Hindi explained, is what Zama calls “programmable confidentiality,” which gives developers control over who can decrypt on-chain data within the smart contract.
“For example, a stablecoin issuer could allow a user to see their own balance, but also a compliance officer,” Hindi said. “The Zama protocol basically doesn’t enforce anything—it’s completely up to the developer to decide what compliance rules they want to follow.”
This level of operability, Hindi said, is the final piece needed for widespread adoption of blockchain technology.
“The issue used to be performance, but Solana and layer-2 networks have solved this. Now that confidentiality is also solved, it means we can start building all of the financial applications on-chain, without having to worry about speed or privacy—both of which are essential if you want to scale to things like global retail payments,” he said.
After years of working in cryptography, Hindi said Zama achieving unicorn status felt long overdue.
“Honestly, it feels great to see amazing investors and builders now care about confidentiality. It’s a battle I’ve been fighting for over a decade,” he said.
Edited by Andrew Hayward
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