The Development and Application Prospects of FHE Technology

Cryptographic technology has played an important role in the course of human civilization, especially in the fields of information security and privacy protection. In recent years, cutting-edge cryptographic technologies such as fully homomorphic encryption (FHE) have received significant attention. FHE allows for arbitrary computation on encrypted data without decryption, bringing new possibilities to multiple fields.

Overview of FHE

FHE is a type of homomorphic encryption technology that allows for computational operations on ciphertext, and these operations can be directly mapped to plaintext. FHE supports unlimited computations and operations on encrypted data.

Currently, Microsoft and Zama are making significant contributions in the field of FHE. Microsoft's SEAL library and Zama's TFHE library both provide efficient implementations of FHE. The basic operation process of FHE includes: generating keys, encrypting data, performing homomorphic computations, and decrypting results.

fhEVM Infrastructure

The fhEVM developed by Zama is a fully homomorphic EVM that supports privacy computing using Solidity. It provides FHE operation support through precompiled contracts, designs EVM memory and storage areas specifically for FHE, and offers a Solidity contract library that lowers the development threshold.

FHE-Rollups Solution

The Fhenix project combines fhEVM with Rollup technology to propose the FHE-Rollups type Layer 2 solution. It adopts Optimistic Rollups technology, with the main components including:

• Fraud proof mechanism based on Arbitrum Nitro
• fheOS core library providing FHE functionality
• Threshold service network responsible for key management and decryption

FHE Coprocessors

Fhenix introduces the Relay module, enabling various public chains and Layer 2 networks to access FHE functionalities. The usage process includes:

1. Application contract calls FHE Coprocessor
2. Relay contract queuing request
3. Relay node forwards requests
4. FHE Rollup Execution Calculation
5. Threshold Network Decryption Output
6. The result is returned to the contract

Application Scenarios of FHE

FHE shows great potential in the following areas:

• Privacy-protected full-chain game
• MEV Protection in DeFi
• AI model training for privacy protection

FHE Ecosystem Development

In addition to Zama and Fhenix, there are other noteworthy projects in the FHE ecosystem:

• Sunscreen: Self-developed FHE compiler
• Mind Network: FHE network combined with EigenLayer
• PADO Labs: zkFHE integrating ZKP and FHE
• Inco Network: Layer 1 that optimizes FHE computational efficiency
• Treat: Shiba ecosystem's FHE Layer3
• BasedAI: A network that introduces FHE functionality for LLMs

FHE technology is flourishing and is expected to play an important role in various fields in the future. With the emergence of more projects and the influx of funds, the FHE ecosystem is likely to experience rapid growth.