Zama, the open-source cryptography firm known for developing Fully Homomorphic Encryption (FHE) for blockchain, said on Tuesday that it will launch the Zama Protocol mainnet. The rollout will be followed by a public token sale: an onchain sealed-bid Dutch auction that the company says will be the first of its kind.
The auction is scheduled for January, with the exact date and participation details to be announced in early January. It will sell 10 percent of the $ZAMA token supply. Unlike typical token offerings, which often take place before a product launches and rely on airdrops or speculative pricing, Zama will sell tokens to users, developers and node operators of an operating mainnet.
The company said bid prices will be publicly visible, while bid sizes will remain confidential. Zama’s FHE technology will encrypt the bid amounts onchain.
Zama said the sealed-bid Dutch auction model has historical precedent. It was used to price Google’s IPO in 2004. Zama said encrypting bid amounts will support fairer, manipulation-resistant price discovery.
The token will support the protocol economy. Applications will pay fees to encrypt and decrypt data, while node operators will stake $ZAMA to secure the network and earn rewards.
“This token auction represents much more than a sale — it is the starting point for a confidential, compliant onchain financial system,” said Dr Rand Hindi, CEO and co-founder. “Zama makes it possible for institutions to issue, transfer, and trade assets privately on public blockchains, opening the door for the $100 trillion financial industry to migrate onchain. Zama is to blockchain what HTTPS was to the internet. We call it HTTPZ.”
Confidential Finance Push
Zama describes the Protocol as a privacy layer for existing public blockchains such as Ethereum. It allows anyone to issue, transfer and trade assets confidentially while keeping transactions auditable and compliant.
The company said institutions have long faced a trade-off between transparency and privacy. They can operate transparently and expose sensitive data, or protect privacy and risk regulatory non-compliance. Zama’s Confidential Blockchain Protocol is designed to remove that trade-off by processing and verifying encrypted data directly onchain without decrypting it.
Zama’s approach is built on Fully Homomorphic Encryption, a cryptographic technique that allows computation on encrypted data. Zama said FHE keeps onchain data encrypted against current and future threats, including quantum attacks, while allowing public verification and compatibility with decentralized finance and other financial applications.
Zama said anything currently done with non-confidential tokens on blockchains can also be done confidentially on its network.
The company highlighted several confidential use cases that its mainnet and partners are developing. Confidential stablecoins could support encrypted payroll and cross-border payments while preserving privacy and embedding AML controls. Encrypted DeFi could protect swaps, lending and derivatives from front-running and data leakage.
Private tokenization could provide confidential LP shares and securities while keeping investor data and positions encrypted but auditable. Confidential governance could keep votes and holdings private while revealing only final tallies.
Zama’s mainnet is launching with an expanding partner ecosystem. The company said its partners are already developing these use cases.
The named projects include Deberrys, described as the first truly confidential auction house on blockchain; Zaiffer, a privacy-preserving DeFi provider; Orion Finance, which focuses on verifiable, privacy-preserving portfolio management; and tGBP, a fully collateralized confidential stablecoin pegged 1:1 to the British Pound.
TokenOps, Raycash, Shiba Inu’s ecosystem, DFNS and security firm OpenZeppelin were also listed as partners. Zama said OpenZeppelin is collaborating on a Confidential ERC-20 token standard.
Zama says it has the world’s largest research team focused on FHE, with more than 100 cryptographers, engineers and blockchain developers. The startup has raised over $150 million from investors including Pantera Capital, Multicoin Capital, Protocol Labs, Metaplanet and Blockchange Ventures.
Zama said it was recently valued at more than $1.2 billion. The upcoming token auction is a milestone on its roadmap toward fully homomorphic onchain computation.
Founded by Dr. Pascal Paillier and Dr. Rand Hindi, Zama has presented its technology as a foundational primitive for confidential finance on public blockchains. The company aims to provide institutions with the privacy guarantees they need while preserving auditability and regulatory compliance.
The January sealed-bid Dutch auction will be the first public test of selling token supply directly on a live mainnet using the same confidential mechanisms Zama says will support the protocol’s future.
