Today, we are starting a series on privacy. Privacy matters. It’s important. It’s a fundamental right, even if we don’t always say so. And it’s vital to have at least some privacy when we transact with others. So we are going to look at the different forms of privacy crypto projects offer.
We will look at the first of the 4 most common privacy types, FHE. FHE stands for Fully Homomorphic Encryption.
What is FHE?
If crypto is already encrypted, then why do we need FHE? It’s a good question. The cryptography or crypto part of cryptocurrency means tokens are already encrypted. And we also know that doesn’t really mean it’s private. Someone who REALLY wants to can figure out your pseudonymous wallet address.
So FHE is like super encryption. Typical encryption locks your data down. That part is good. But it also means that you can’t do anything with it until after you unlock it. So if you need to move funds around or something, then you need to unlock it first. And that’s when you subject your tokens to bad actors. At exactly the time you don’t want them around.
If you want a DeFi app, for example, to process your data so you can earn on your USDC, then you have to unlock it first. That’s the tough part.
FHE is an exception to this basic encryption rule. With FHE, you can do computations and data manipulation all you want WITHOUT leaking or exposing the data to others. Think about the implications of this just in an area like health care or finance. A doctor does not have to open up your file to everyone to see what they need to see to diagnose your condition. Or to see how the drug protocol for treatment is working. Isn’t that awesome?
What is @zama FHE?
Zama FHE stand for Fully Homomorphic Encryption a special kind of encryption that keep data locked even while it’s being used.
Normally, to use data, you need to decrypt it first which makes it exposed.
But with FHE, you can do math, run smart contract or… pic.twitter.com/oVI5TSDYsb
— 𝗧𝗮𝗺𝗶𝗺 (@MdTamim470123) November 2, 2025
Isn’t that what we want out of our data? That anyone else in the hospital only sees encrypted data they can’t access or share, but your doctor can use it just for what they need. Or a researcher for a medical study, without revealing that you are taking part in it.
What Makes FHE Better Than Other Types of Privacy?
Regular encryption does a good job of not exposing our data. Tools like VPNs and others that anonymize your data can hide it when it’s in transit. But neither can protect it when you have to process the data, like when making computations with it. But FHE does. Compute all you want without revealing that data. And that’s awesome.
What projects use FHE?
So who uses FHE? There aren’t many projects at the moment. Tech-wise, FHE is difficult to implement. Zama is one of the leaders, as is Arcium, who is working to bring privacy to Solana.
You can now make your Seeker phone <encrypted>.
Powered by custom Seeker phone cases from @SOLYD_STORE pic.twitter.com/S2zeaQe7Xy
— Arcium ☂️ (@Arcium) November 2, 2025
Honestly, there are very few despite how great this tech is. There’s a fear among privacy protocols that they won’t be able to get funding if the privacy is “too tough” for governments to enforce on a project to open up for them for criminal activity. This is why some of the lesser forms of privacy do better. They are more flexible, such as when you have the option to turn the privacy on or off. And thus, they do better in both regulatory environments and in funding.
Fhenix, Inco, Privasea, and a couple of others are smaller, trying to build out full-scale projects using FHE.
Finally, let’s remember that we are here because privacy is important. Yet, we are also here to make money. The Privacy sector is up 66% in the last 7 days, according to CoinGecko.
As you can see, that’s #1 of all sectors in what’s been a tough week for the market. ZCash, Dash, and Railgun are leading the way, all up more than 100% in the last week. And privacy could continue to run from here. All it takes is a reminder of why it’s important. People are starting to remember.
Next, we will explore a different, yet popular form of privacy in crypto in Part 2. Stay tuned for that.
Disclaimer
The information provided by Altcoin Buzz is not financial advice. It is intended solely for educational, entertainment, and informational purposes. Any opinions or strategies shared are those of the writer/reviewers, and their risk tolerance may differ from yours. We are not liable for any losses you may incur from investments related to the information given. Bitcoin and other cryptocurrencies are high-risk assets; therefore, conduct thorough due diligence. Copyright Altcoin Buzz Pte Ltd.
The post Privacy Series Part 1: FHE Fully Homomorphic Encryption appeared first on Altcoin Buzz.
