Original author: Kyle Samani, founder of Multicoin Capital
Translator: Odaily Odaily Azuma
Editor's note:
On March 7, Zama, an open source cryptography company that aims to help developers build privacy-preserving applications, announced the completion of a $73 million Series A round of financing, co-led by Multicoin Capital and Protocol Labs, with participation from Metaplanet, Blockchange Ventures, Vsquared Ventures and Stake Capital, as well as Filecoin founder Juan Benet, Solana co-founder Anatoly Yakovenko and Ethereum co-founder and Polkadot co-founder Gavin Wood participated in the investment.
In the early morning of March 8, Multicoin Capital founder Kyle Samani wrote an article titled "The Holy Grail of Cryptozoology". The article explained in detail the logic of Multicoin Capital's leading investment in Zama, and predicted Zama and its main promotion of "Quantong." The potential application value of "FHE" (FHE) in the cryptocurrency industry.
The following is the full text of Kyle, compiled by Odaily Odaily.
In a sense, every server-side security breach (or attack) that has occurred in the past 30 years has the same root cause - some sensitive data was not encrypted, or the attacker obtained the key to decrypt it. key.
When we describe the problem like this, the solution is clear - always keep the data encrypted and make sure not to store the decryption key on any server.
The problem with this solution is that it used to be impossible...but not anymore.
Today, I’m excited to announce that Multicoin Capital and Protocol Labs have co-led a $73 million investment in Zama, with participation from Metaplanet, Blockchange, VSquared, Stake Capital, and Portal Ventures, as well as investment from Juan Benet (Filecoin ), Gavin Wood (Polkadot), Anatoly Yakovenko (Solana), Julien Bouteloup (StakeDAO) and Tarun Chitra (Gauntlet), among several other project founders.
Zama is the leader in the "fully homomorphic encryption" (fully homomorphic encryption, FHE) track. The special feature of FHE is that it allows arbitrary computation on encrypted data. The concept has been around in academia for decades, but has been too computationally intensive to be of practical value in the past.
The Zama team (composed of more than 30 PhDs and cryptography experts) has made dozens of breakthroughs around FHE in the past four years. For certain types of computing work (the first is the blockchain field), Zama's TFHE-rs and Concrete open source libraries are ready for production. In the next few years, we expect to achieve 1000x performance improvements in mathematics, software, and hardware (such as ASICs), which will allow FHE-based encrypted calculations to compete directly with plaintext calculations.
Odaily Odaily Note: The following is an example of how FHE is used in the field of privacy computing.
Suppose we have an encryption function f, which can turn plaintext A into ciphertext A', and plaintext B into ciphertext B', that is to say, f(A) = A', f(B) = B'; In addition, we also have a decryption function f', which can decrypt the ciphertext encrypted by f into the plaintext before encryption. That is to say, the ciphertext A' can be turned into plaintext A, and the ciphertext B' can be turned into plaintext B. .
For general encryption functions, if we add A' and B' to get C', and then use the f' function to decrypt C', we will only get a meaningless string of garbled codes.
However, if f is an encryption function that can perform homomorphic encryption, then we can get the result C after decrypting C' using f', and C will also be equal to the result of adding A and B.
In this way, data processing rights and data ownership can be separated, thereby preventing data leakage without affecting computing.
I believe it won't be long before every Web2 application from database applications to large language models will introduce FHE technology.
FHE will revolutionize the underlying architecture of computing.
One of the characteristics of the blockchain field is that it can create huge financial value even if the transaction throughput is quite limited. Therefore, considering the current limitations in FHE performance, Zama will first focus on the blockchain field.
For Multicoin Capital and Protocol Labs, this is the main reason why we led the investment in Zama and want to bring its technology to the market. We have been working closely with the Zama team and helping them implement FHE on the chain.
Regarding on-chain privacy, there are actually many solutions on the market. For simple payments, the effect of Zero-Knowledge Proof (ZKP) has been fully proven. However, for transactions involving shared state - which covers almost all DeFi transactions - ZKP always has insufficient utility. Or extremely difficult to implement.
The beauty of FHE is that it allows developers to execute exactly the same logic in FHE's encrypted environment as in a transparent environment.
Currently, three teams have announced that they will use Zama's technology to build FHE-based blockchains, including Fhenix (we have also invested in them), Inco and Shiba, all of which will be launched this year.
Zama provides fhEVM out of the box for developers who want to implement FHE on EVM, and I expect that Zama will soon support more blockchain virtual machines in addition to EVM.
The introduction of FHE will realize new possibilities in the following aspects:
Privacy-based DeFi applications;
Cryptovoting;
Privacy-based Data Autonomous Organizations (DataDAOs);
Blind shooting on the chain;
On-chain games;
A new way of thinking across chains (store the FHE encryption private key of chain B on chain A, and vice versa);
We're still in the early stages of use case exploration, and I'm very excited to see developers build new and exciting applications using FHE.
In 5 to 10 years, we may look back at some of the cloud data breaches that are happening now and be shocked - people will not understand why user data was not encrypted.
A few years ago, the Zama team proposed their idea for an iteration of HTTPS, which they called HTTPZ. HTTPZ is a natural outgrowth of the cryptographic logic of the Internet, where users encrypt data locally with their own keys and then send the encrypted data to a server, which can then perform calculations on the encrypted data.
In an HTTPZ configuration, it can be assumed that the server is always at risk of intrusion, but if all user data is encrypted and the keys are kept by the user themselves on the device, even if an attacker accesses the server, it will be of no avail.
HTTPZ represents the most ambitious vision of applying encryption technology to the Internet.
Based on the trend of gradual popularization of cryptography technology in the past 30 years, we believe that this day will eventually come, it is just a matter of time.
We're incredibly excited to support Rand, Pascal (Zama co-founder), and the entire Zama team as they lead the revolution in cryptography.
