Zama, the open-source cryptography company building state-of-the-art Fully Homomorphic Encryption (FHE) solutions for blockchain, has announced the imminent launch of the Zama Protocol mainnet and the first-ever sealed bid Dutch auction for its native token which will be held on that mainnet using Zama’s own technology. The Zama Protocol adds a layer of confidentiality to existing public blockchains such as Ethereum, enabling anyone to issue, transfer, and trade assets confidentially. 

Following the mainnet launch, Zama will hold a public auction in January, selling 10% of the $ZAMA token supply through an onchain sealed-bid Dutch auction that uses Zama’s own technology to encrypt bid amounts onchain. This auction model has been successfully validated by its use in Google's IPO (2004), demonstrating its effectiveness in ensuring fair and transparent price discovery. Participants will submit bids with public prices while keeping bid sizes fully confidential, ensuring a fair and manipulation-resistant price discovery process. The exact auction date and participation details will be announced in early January. The $ZAMA token powers the protocol economy: applications pay fees to encrypt and decrypt data, while node operators stake $ZAMA to secure the network and earn rewards. 

Unlike typical token launches that occur before the solution is available and rely on airdrops or speculative pricing, Zama is will be selling tokens to users, developers, and operators of an already existing, live mainnet, using its own technology to ensure a fair distribution and pricing of the $ZAMA token.

“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.”

A Foundation for Confidential and Compliant Onchain Finance

As finance transitions to blockchain infrastructure, institutions have faced an impossible trade-off: operate transparently and expose sensitive data, or protect privacy and risk regulatory non-compliance. Zama’s Confidential Blockchain Protocol solves this by enabling encrypted data to be processed, verified, and audited directly onchain without ever being decrypted, while ensuring transactions remain publicly auditable and compliant through programmable access controls. 

The Zama Protocol leverages Fully Homomorphic Encryption (FHE) to ensure data onchain remains securely encrypted, even in the face of future quantum threats, while being publicly verifiable and composable with DeFi and other financial applications. Anything that can be done with non-confidential tokens on blockchains can now be done confidentially with Zama. 

Powering Confidential Applications  

With the Zama Protocol, developers can build confidential applications across DeFi, stablecoins, and tokenized assets that remain auditable yet private, and fully interoperable with both DeFi and TradFi systems:

• Confidential stablecoins: encrypted payroll and cross-border payments that preserve privacy while embedding AML compliance.

• Encrypted DeFi: swaps, lending, and derivatives protected from front-running and data leakage.

• Private tokenization: confidential LP shares and securities where investor data and positions remain encrypted yet auditable.

• Confidential governance: votes and holdings stay encrypted, revealing only final tallies.

The Zama mainnet will launch with a growing ecosystem of partners, already bringing these use cases to life, including:

• Deberrys: the first truly confidential auction house on blockchain.

• Zaiffer: privacy-preserving DeFi that lets users control their financial data without compromising compliance or usability.

• Orion Finance: vault infrastructure for verifiable, privacy-preserving portfolio management.

• tGBP: a fully collateralized, confidential stablecoin pegged 1:1 to the British Pound.

• TokenOps: tools for managing and automating tokenized assets securely and privately onchain.

• Raycash: a decentralized banking app providing the control of crypto, the privacy of banks, and the usability of an everyday money app.

• Shiba Inu: one of the world’s largest decentralized ecosystems, pioneering privacy-first applications for its community.

• DFNS: the leading Wallets-as-a-Service (WaaS) provider powering secure and scalable digital asset management.

• OpenZeppelin: which is collaborating with Zama to define and standardize the Confidential ERC-20 token format.

With the largest FHE-focused research team in the world and over 100 cryptographers, engineers, and blockchain developers, Zama has raised more than $150 million from investors, including Pantera Capital, Multicoin Capital, Protocol Labs, Metaplanet, and Blockchange Ventures, recently valuing it at over $1.2 billion. The token auction will mark a key step in Zama’s roadmap toward fully homomorphic onchain computation.