Fhenix Acquires Sunscreen to Expand Blockchain Privacy Technology

Blockchain privacy infrastructure provider Fhenix has acquired cryptography startup Sunscreen to strengthen its fully homomorphic encryption (FHE) capabilities and accelerate the development of privacy technologies for blockchain applications.

The acquisition brings Sunscreen founder Ravital Solomon to Fhenix, where she will lead research across advanced cryptography fields including TFHE, BFV, encrypted computation, and post-quantum security.

The acquisition expands Fhenix’s fully homomorphic encryption technology by combining Sunscreen’s expertise with its existing privacy infrastructure to support scalable encrypted computation for blockchain networks.

The transaction comes as blockchain developers face increasing demand for privacy-preserving infrastructure. The growth of stablecoins, tokenized real-world assets, artificial intelligence applications, and institutional participation in digital assets has increased the need for technologies that allow sensitive data to be processed without exposing underlying information.

Fully homomorphic encryption enables computations to be performed on encrypted data without requiring decryption, making it a technology that many developers view as a potential building block for confidential blockchain applications.

Sunscreen Brings Established Cryptography Expertise

Founded as one of the early Web3 companies focused on fully homomorphic encryption, Sunscreen has developed open-source compiler tools for FHE since its public launch in 2022. The company later expanded its work into zero-knowledge systems, threshold encryption, and developer-focused privacy infrastructure.

Solomon has contributed to research involving lattice-based post-quantum cryptography, encrypted smart contract design, and frameworks intended to make privacy-preserving computation practical for blockchain environments.

The acquisition is expected to broaden Fhenix’s capabilities in compiler development, threshold cryptography, and encrypted application architecture as the company expands its research efforts.

Focus on Ethereum-Compatible Networks

Fhenix is developing its privacy infrastructure through CoFHE, an encrypted computation layer designed for Ethereum Virtual Machine (EVM)-compatible blockchains. The platform is also advancing research into threshold FHE decryption, DBFV exact arithmetic, and scalable encrypted computation intended for production blockchain workloads.

The combined research team will focus on developing scalable fully homomorphic encryption systems and quantum-resistant infrastructure for applications spanning payments, finance, digital identity, and artificial intelligence.

According to the company, integrating Sunscreen‘s research team is expected to accelerate work across these areas while reinforcing its long-term strategy of building production-grade privacy infrastructure.

Guy Zyskind, founder of Fhenix, said the industry’s focus had shifted from demonstrating that encrypted computation was technically feasible to making the technology scalable and practical for developers building across multiple blockchain ecosystems. He added that bringing Solomon and the Sunscreen team into Fhenix would accelerate efforts to develop a quantum-resistant privacy layer for Ethereum, Arbitrum, and Base.

Privacy Becomes Core Blockchain Infrastructure

The acquisition reflects a broader shift in blockchain infrastructure as privacy technologies move beyond niche use cases into mainstream development. Industry participants are increasingly seeking solutions that combine regulatory requirements with confidential data processing as blockchain adoption expands across financial services and enterprise applications.

Fhenix said the acquisition forms part of its broader strategy to consolidate cryptography expertise as demand for privacy-preserving infrastructure continues to grow across the blockchain industry.

The deal also highlights growing investment in cryptographic technologies designed to support secure on-chain computation without compromising data confidentiality, an area expected to play a larger role as blockchain networks handle increasingly complex financial and enterprise workloads.

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