We at Greenfield are excited to lead Arcium’s $5.5M strategic funding round to launch the first parallelized confidential computing network. Arcium builds a foundational technology that unlocks a plethora of existing and new use cases, that require confidentiality, for Web3.

The original publication can be found at Greenfield Publications.

We at Greenfield are excited to lead Arcium’s $5.5M strategic funding round to launch the first parallelized confidential computing network. Other investors include Coinbase Ventures, Heartcore Capital, LongHash VC, L2 Iterative Ventures, Staking Facilities, Smape Capital and Everstake along with angel investors including Anatoly Yakovenko, co-founder of Solana, Keone Han, co-founder of Monad, Mert Mumtaz, co-founder of Helius Labs, Santiago R Santos, Kenny Li, co-founder of Manta Network and Lucas Bruder, co-founder of Jito amongst others.

Arcium was founded by Yannik Schrade, Julian Deschler, Nicolas Schapeler, and Lukas Steiner. They have already impressed us with Elusiv, their previous project, pioneering user-friendly and compliant transaction privacy on Solana. Now with Arcium the team builds a foundational technology that unlocks a plethora of existing and new use cases, that require confidentiality, for Web3.

Privacy is everywhere

Privacy is a fundamental human right and a core element of our daily lives. Examples where privacy matters can be found easily: payments, bank transactions, medical records, messaging, voting and legal contracts. Privacy is not only normal – but a prerequisite for exercising freedom of thought/speech and as a consequence essential for democracy. Anonymity and/or confidentiality are the two core components of privacy. Whereas anonymity ensures the identity of the user is unknown, confidentiality ensures the user’s action/information is unknown. To understand the pressing need for confidentiality within Web3 let’s first juxtapose it to Web2:

The old world

In Web2, surveillance capitalism is a prevalent business model. The product seems to be free, but the hidden cost is the user’s information. The user gives up on anonymity and confidentiality toward the service company, but remains optionally anonymous/confidential toward other users. Collected information is stored in private silos and used in a variety of company-benefitting use cases: 1) to optimize the user’s timeline in such a way that the user spends more time on the platform 2) to target adequate customers with optimal advertisements (remember Cambridge Analytica) 3) to resell user information to the highest bidder for diverse downstream use cases e.g. training data for AI models, predictive policing, voter trend analysis and more. Hence, companies have a strong incentive to acquire more and to reinforce the information asymmetry by e.g., closing previously available APIs.

The new world

This is in stark contrast to Web3: Information is stored publicly on-chain to ensure integrity and to be able to verify the authenticity thereof, be it a financial transaction, a loan, a limit order, a social graph, or a digital twin deed. Public data and interface standards allow streamlined cooperation between protocols in a permissionless manner resulting in strong network effects. The public traces of these on-chain interactions are stored on an immutable ledger such as Ethereum or Solana for anybody to utilize. Hence, confidentiality as a feature of these systems does not exist. When assessing anonymity one can easily make the mistake that these systems are anonymous. While it’s true that wallets/accounts can be created and used without sharing one’s identity, they can be easily linked to off-chain metadata such as IP or browser fingerprint and tracked across interactions with protocols/exchanges, etc. Hence, most blockchains are pseudo-anonymous and non-confidential.

Enabling confidentiality in Web3 finally makes many existing use cases in Web2 (including information asymmetry) possible in Web3. The even more exciting use cases, however, will combine the old network effects of Web2 with the new network effects and capabilities of Web3: liveness, permissionlessness, composability, censorship resistance, verifiability, and, last but not least, ownership.

Technology

Arcium is revolutionizing secure computation on encrypted data with its innovative “Multi-Party eXecution Environments” (MXEs). By integrating technologies like multi-party computation (MPC), homomorphic encryption, zero-knowledge proofs, and more, MXEs provide a customizable and secure environment for confidential computing. The team strives to have a frictionless developer experience providing adequate tooling and support.