A Shift in Web3 Privacy Infrastructure
Blockchain privacy firm Fhenix announced July 2 the acquisition of Sunscreen, an early-stage developer of fully homomorphic encryption (FHE), technology for Web3 applications. As part of the transaction, Sunscreen founder Ravital Solomon will join Fhenix to lead the company’s cryptographic research operations.
The acquisition combines the two firms’ respective focus areas in advanced cryptography, including TFHE and BFV encryption schemes, encrypted computation, and post-quantum security. The consolidation comes amid a broader push within the cryptocurrency industry to establish encrypted computation as standard infrastructure.
As institutional capital, tokenized real-world assets, stablecoins and artificial intelligence systems increasingly migrate to blockchain networks, security and privacy technologies have shifted from niche applications to foundational requirements for mainstream deployment.
Since its 2022 launch with an open-source FHE compiler, Sunscreen expanded into zero-knowledge tooling, threshold-encrypted systems and privacy architectures. Solomon specializes in adapting lattice-based, post-quantum cryptography for smart contracts and production environments.
“FHE is entering a new phase,” Guy Zyskind, founder of Fhenix, said in a statement. “The conversation is no longer about whether encrypted computation works. It’s about making it scalable, practical, and available across the ecosystems where developers are building today.”
Zyskind added that the acquisition is aimed at accelerating the deployment of a quantum-safe privacy layer across major blockchain networks, including Ethereum, Arbitrum and Base.
Fhenix has been expanding its privacy stack through CoFHE, its encrypted computation infrastructure tailored for Ethereum Virtual Machine ( EVM) applications. The company’s recent research initiatives have focused on threshold FHE decryption, exact arithmetic and scaling encrypted computing to handle real-world blockchain workloads.
“I started Sunscreen because I believed advanced cryptography should shift from theoretical to usable,” Solomon said. “What excited me about joining Fhenix is the combination of ambitious research and a clear path to deployment.”
The unified research division will focus on developing scalable, quantum-resistant FHE systems. Fhenix officials stated that the long-term goal of the consolidated team is to build the cryptographic foundations necessary to support confidential onchain data processing across financial services, digital payments, identity verification and AI applications.
