FHE Technology: An Emerging Force in the Blockchain Field

Cryptographic technology plays an important role in the process of human civilization, especially in information security and privacy protection, which is indispensable. It provides protection for data transmission and storage in various fields, and its asymmetric encryption public-private key system and hash functions have been creatively integrated by Satoshi Nakamoto to design the proof-of-work mechanism, thus promoting the birth of Bitcoin and ushering in the Blockchain era.

With the development of the blockchain industry, a series of cutting-edge cryptographic technologies have emerged, among which zero-knowledge proofs, multiparty computation, and fully homomorphic encryption are the most notable. These technologies are widely applied in various scenarios, such as zero-knowledge proofs combined with Rollup solutions to address the blockchain scalability issue, and multiparty computation combined with public-private key systems to promote large-scale adoption by users. Fully homomorphic encryption, as one of the holy grails of cryptography, allows third parties to perform arbitrary computations on encrypted data without decryption, bringing new possibilities to various fields.

FHE Overview

FHE is the abbreviation for Fully Homomorphic Encryption, and its core feature is the ability to perform computations and operations on ciphertext, which can be directly mapped to plaintext, thus preserving the mathematical properties of the encrypted data. The "F" in FHE signifies that this homomorphism has reached a new height, allowing for unlimited computations and operations on encrypted data.

The actual FHE uses a series of complex mathematical algorithms that have extremely high requirements for computing resources. In the FHE field, Microsoft and Zama stand out with their excellent open-source products. Microsoft's SEAL is an efficient C++ library that supports fully homomorphic and partially homomorphic encryption. Zama's TFHE is a C language library focused on high-performance fully homomorphic encryption.

The basic operation process of FHE includes: generating keys, encrypting data, performing homomorphic computations, and decrypting results. Among these, the management of the decryption keys is particularly crucial, and a threshold multi-party secure computation scheme can be used to enhance security.

fhEVM: Laying the Foundation for FHE

To apply FHE on the Blockchain, the ideal way is to encapsulate it as a general smart contract code library. This requires the virtual machine to support the complex mathematical operation instruction set required for FHE. The EVM has become the preferred choice for implementing FHE, and Zama has excelled in this field.

Zama has launched fhEVM, a fully homomorphic EVM that supports Solidity for implementing privacy computing. The core features of fhEVM include:

• Provide FHE operation support through pre-compiled contracts
• Decryption mechanism based on distributed threshold protocol
• Solidity contract library that lowers the development threshold

fhEVM provides a solid foundation for FHE technology in blockchain applications, but it may still face many challenges in practical applications.

FHE-Rollups: Building the FHE Ecosystem

The pure fhEVM is difficult to independently form a complete ecosystem and needs to rely on public chain architecture or Layer 2/Layer 3 solutions. As a pioneer, Fhenix explores the combination of fhEVM with Rollup technology and proposes the construction of an FHE-Rollups type Layer 2 solution.

Fhenix adopts the Optimistic Rollups solution, its technology stack includes:

• Variant of Arbitrum Nitro's fraud prover
• Core Library fheOS
• Threshold Service Network ( TSN )

The Fhenix Frontier version released by Fhenix provides a smart contract code library, Solidity API, development toolchain, and more.

FHE Coprocessors: Chain-Agnostic Solutions

Fhenix introduces the Relay module, enabling various public chains and Layer 2/3 networks to connect to FHE Coprocessors. Through EigenLayer's Restaking mechanism, the efficiency and flexibility of FHE Coprocessors are enhanced.

The usage process of FHE Coprocessors includes: application contract calls, Relay queuing requests, FHE Rollup executing computations, threshold network decryption, result return, and verification steps.

Application Scenarios of FHE

FHE technology shows great potential in various fields:

• Privacy-protected full-chain games: encrypted protection of game economic transactions to prevent real-time manipulation.
• DeFi/MEV: Protect sensitive data and reduce MEV attack risks
• AI: Model training is conducted under the premise of protecting personal privacy.

FHE Ecosystem Early Projects

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

• Sunscreen: Self-developed FHE compiler
• Mind Network: Combining EigenLayer's FHE Network
• PADO Labs: A decentralized computing network that integrates ZKP and FHE
• Arcium: Parallel Confidential Computing Network
• Inco Network: A Layer 1 focused on optimizing FHE computation costs
• Treat: FHE Layer3 of the Shiba ecosystem
• octra: Supports FHE networks with isolated execution environments
• BasedAI: A network that introduces FHE functionality for LLMs
• Encifher: Developing FHEML around FHE
• Privasea: A FHE network focusing on privacy protection in AI domain ML inference.

In addition, non-profit organizations such as FHE.org and FHE Onchain provide valuable research and educational resources for the ecosystem.

The prospects of FHE technology are bright. With the development of projects like Fhenix, it is expected to bring new innovations and vitality to Blockchain.