Pantera, Blockchange lead funding for privacy-focused Zama Confidential Blockchain Protocol at $1 billion valuation

The team behind the privacy-focused Zama Confidential Blockchain Protocol has raised a $57 million Series B at a valuation of over $1 billion, according to a statement on Wednesday. This round coincides with the announcement of Zama’s forthcoming testnet, which is expected to launch on July 1.

The round was led by Pantera Capital and Blockchange.

"For the past few years, we have been building the most developer friendly, fast and secure Fully Homomorphic Encryption (FHE) scheme, licensing the technology to dozens of companies across blockchain and AI," co-founder Rand Hindi wrote on X . “Today, we are unveiling our most ambitious product to date: the Zama Confidential Blockchain Protocol."

Zama enables developers to launch "confidential smart contracts" on top of other blockchains. The protocol is not actually a blockchain in itself, but rather a cross-chain confidentiality layer "sitting on top of existing chains."

According to Hindi, Zama offers end-to-end encryption to prevent anyone — including node operators — from viewing transaction data as well as “programmable confidentiality” that enables developers to control how private their smart contracts are to the world.

The project is one of an emerging number leveraging fully homomorphic encryption (FHE), a cryptographic technique that allows operations to be performed on encrypted data without being decrypted. It also uses multi-party computation (MPC) and “lightweight” zero-knowledge proofs (ZK) to further its privacy guarantees.

Zama currently handles about 20 transactions per second; however, Hindi said the plan is to scale to “10,000+ tps” per chain using “dedicated hardware accelerators” like ASIC chips.

“Until recently however, FHE was too slow, too limited in terms of applications it could support, and too difficult to use for developers,” Hindi said. “This is what our team at Zama has spent the last 5 years solving. We now have a highly efficient FHE technology that can support any type of application, using common programming languages such as Solidity and Python.”

Initially centered around the Ethereum Virtual Machine (EVM) ecosystem, Zama will eventually be expanded to Solana, Hindi said. The protocol is also allegedly quantum-resistant.