What Is Fully Homomorphic Encryption (FHE) in Web3?

gmeow gmeow gmeow! Intern is back with another piece of musings. this time, I’m breaking down a very complicated sounding concept that I first heard about when I was helping to post our EthCC summary on behalf of my teammate. immediately decided this would be a good topic to read up on.

here’s what Intern gathered on what fully homomorphic encryption (FHE) is:

what is FHE?

some say that FHE is very similar to zero-knowledge (ZK) technology, lesser known in the crypto space currently, but better! FHE is a cryptographic technology that allows computation on encrypted data without needing decryption. it’s one of the technologies that has been discussed about as part of the rising web3 privacy vertical, being a privacy solution that protects confidentiality of information.?

web3 privacy technologies

apart from FHE, other associated technologies in the web3 privacy vertical include ZK, multi-party computation (MPC), and trusted execution environments (TEE). sharing a good comparison table by Greenfield Capital here:

FHE is often compared to ZK as they’re both cryptographic techniques that ensure data privacy. however, they have significant differences and use cases!?

ZK vs. FHE

ZK involves a prover and a verifier: the prover submits a secure code to the verifier to prove knowledge of a certain information without revealing the information itself. on the other hand, FHE allows computation on encrypted data.

as such, ZK is suited for validation of ownership of data, for uses such as authentication; while FHE supports computation, for uses such as processing sensitive information from multiple sources and broadcasting only the final result.?

additionally, less computation in ZK means that it’s generally lighter, faster, and cheaper, whereas FHE processes are more computationally heavy and expensive. as much as we like to compare the two, they are no opposing or competing technologies, but rather, can be used together to build optimised systems!

curious about FHE use cases and the current FHE ecosystem in crypto? read the full article here!

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