Zama and T-REX Bring Privacy to Tokenized Assets on Public Chains

• Zama has integrated its privacy technology with the T-REX Ledger to enable confidential institutional trading on public blockchains.
• The collaboration utilizes the ERC-3643 standard, allowing regulated entities to maintain identity compliance while encrypting transaction data.
• French startup Zama recently raised $73 million in Series A funding to commercialize its Fully Homomorphic Encryption (FHE) technology.

Protecting Institutional Data on Public Chains

The cryptography firm Zama is bringing its privacy-focused protocol to the Apex-backed T-REX Ledger, aiming to bridge the gap between public blockchain transparency and institutional confidentiality requirements. By integrating with the ERC-3643 tokenization standard, the partnership allows banks and asset managers to trade sensitive assets without exposing their positions or transaction details to the public. This development targets a primary obstacle that has prevented widespread institutional adoption of public decentralized networks for regulated securities.

The Role of Fully Homomorphic Encryption

At the core of this integration is Fully Homomorphic Encryption (FHE), a technology that allows computations to be performed on encrypted data without needing to decrypt it first. Unlike traditional methods, Zama seeks to make privacy an inherent feature of the infrastructure. Key features of this implementation include:

• Shielding existing positions: Users can wrap ERC-3643 tokens into confidential versions, maintaining a 1:1 balance.
• End-to-end encryption: Future transfers and resulting balances are encrypted throughout the transaction lifecycle.
• Off-chain KYC: While compliance rules and identity checks are embedded in smart contracts, sensitive personal data remains off-chain.

Industry Competition for Privacy Standards

The announcement highlights an ongoing debate regarding the best technical approach for on-chain privacy. While Zama promotes FHE as a solution for shared state computations, other industry leaders favor different paths. Matter Labs CEO Alex Gluchowski argues that zero-knowledge (ZK) systems like zkSync’s Prividium are the only way to achieve true privacy and atomic settlement. Conversely, Digital Asset co-founder Shaul Kfir suggests that permissioned architectures like Canton are more suitable for real-world assets, emphasizing that legal enforceability is more critical for institutions than purely cryptographic guarantees. Zama founder Rand Hindi maintains that FHE is complementary, solving scalability and sharing issues that currently limit both ZK and permissioned systems.