Zama Raises $57 Million in Series B Funding Round Becomes World's First FHE Unicorn

Zama, a company specializing in open-source cryptography, has successfully raised $57 million in its Series B funding round. This investment was co-led by Blockchange Ventures and Pantera Capital, both based in the U.S. With this funding, Zama's total investment reaches over $150 million, and its valuation exceeds $1 billion, making it the world's first Fully Homomorphic Encryption (FHE) unicorn. The funds will be used to support the mainnet launch, ecosystem adoption, and research efforts to scale financial applications built with FHE to thousands of transactions per second.

The announcement coincides with the launch of the Zama Protocol, which enables confidential applications on any blockchain. Starting from July 2025, developers will be able to build FHE applications on Zama’s public testnet. The protocol supports other EVM chains and Solana, with plans to expand further. This development reflects the growing demand within the finance ecosystem for technologies that enable confidential, scalable, and compliant onchain financial applications.

Dr. Rand Hindi, CEO and co-founder of Zama, highlighted the significance of this milestone, stating that reaching a $1 billion valuation reflects the market's confidence in Zama's FHE technology and the team's ability to deliver confidentiality to financial applications onchain. Ken Seiff, Co-Managing Partner of Blockchange Ventures, compared Zama's potential impact to that of Ethereum, noting that as finance moves onchain and regulations tighten globally, public blockchains are likely to be the first beneficiaries of Zama's technology. Paul Veradittakit, Managing Partner at Pantera, emphasized that Zama's FHE protocol launch is a cryptography milestone, unlocking secure, compliant, and verifiable decentralized applications (dApps) for AI, crypto, and cloud.

Zama's FHEVM allows for the execution of confidential smart contracts on encrypted data, ensuring both confidentiality and composability. This technology unlocks several use cases, including onchain finance, confidential tokens, identity and proof of humanity, and network states. Financial institutions can securely use public blockchains for applications such as confidential stablecoin issuance and payments, asset tokenization, and compliance. Confidential tokens enable blockchain companies to distribute tokens without disclosing ownership, reducing the risk of being targeted by hackers. The ability to verify whether a user is human without disclosing their identity publicly is essential for the security of onchain finance. Additionally, Zama enables onchain communities and network states to operate confidentially, running key infrastructure on public blockchains.

Zama is actively addressing the core challenges that have historically held back FHE adoption. The company's FHE technology is currently 100x faster than when it was founded and is capable of supporting most onchain payment use cases. Zama aims to make its technology 100x more scalable within the next five years, allowing it to address the most demanding onchain applications. By using GPUs, Zama can scale to hundreds of transactions per second and is working towards a dedicated hardware-accelerated chip to reach tens of thousands of transactions per second. Developer usability is also a priority, as Zama's technology does not require learning new programming languages; developers can use existing languages like Solidity and deploy their applications on their preferred chain.

This funding round underscores a broader shift in the industry, where confidentiality is no longer a niche concern but a foundational requirement. The broad adoption of blockchain in finance is driving demand for secure, confidential computing technologies. Zama, founded by Dr. Pascal Paillier and Dr. Rand Hindi, has the largest research team in homomorphic encryption and is committed to advancing the field of FHE and commercializing its accessibility to blockchain applications and beyond.