Gentry Testnet secures $4.5M to bring confidentiality to Web3

Recently, Inco announced that they have acquired $4.5 million in seed funding from 1kx for their groundbreaking confidentiality layer project on Ethereum and other networks.

The financing round secured investments from Circle Ventures, Robot Ventures, Portal VC, Alliance DAO, Big Brain Holdings, Symbolic, GSR, Polygon Ventures, Daedalus, and Matter Labs, which are highly regarded in the industry.

In addition to the announcement, Inco has also introduced the Gentry testnet, which aims to address the privacy challenges of Web3 in order to encourage its widespread adoption. Inco utilizes a combination of the traditional Ethereum Virtual Machine (EVM) and Fully Homomorphic Encryption (FHE), with security provided by EigenLayer through Ethereum.

This cryptographic method enables programs to manipulate and process encrypted data without the need for decryption.

In a blockchain protocol utilizing FHE, all on-chain data is kept confidential for all participants, including validators, while still being auditable if necessary. This technology does not rely on TEEs, circuits, or external coordination, and also incorporates native randomness.

A new era of decentralized apps

The creators of Inco recognize the importance of confidentiality in creating highly sought-after Web2-style applications.

Through its inherent on-chain confidentiality and randomness capabilities, Inco makes it possible for a diverse array of new applications to be developed, spanning different industries such as gaming, gambling, DeFi, and enterprise solutions like secure stable coins, private real-world assets, confidential voting, and blind auctions.

According to the founder of Inco, Remi Gai, the transparency and immutability of blockchain, although originally seen as strengths, have actually caused more issues than its predecessor in web2.

This environment enables corporations, hackers, and other actors to misuse the public nature of these ledgers for creating comprehensive data profiles and tracking individuals, thus infringing upon personal privacy and security. Additionally, this level of transparency limits the feasibility of certain decentralized applications (DApps) in areas requiring confidentiality, such as gaming, decentralized finance (DeFi), and enterprise and institutional solutions.

Remi Gai, INCO Founder

As a result, Inco’s mission is to introduce confidentiality to blockchains and eliminate the final barrier to widespread adoption of Web3.

In the past, there have been options like Zero-Knowledge Proofs that allow for confidential transactions, but they do not inherently apply to shared information. While Trusted Execution Environments offer protection for sensitive data, they are susceptible to side-channel attacks.

As a result, Fully Homomorphic Encryption (FHE), which was previously hindered by difficult computational hurdles and intricacy, has now emerged as a potential solution in this area.

According to Wei Dai, Research Partner at 1kx, the potential of smart contracts has been hindered due to their inability to utilize customizable confidentiality.

However, Inco’s implementation of threshold FHE and blockchain technology has revolutionized this aspect and is now being introduced to the market. 1kx is excited to collaborate with and assist the Inco team in their goal of incorporating confidentiality into Web3.

Inco offers modularity and compatibility with external blockchains through validated bridges like Hyperlane and natively verified IBC.

It grants developers the capabilities of traditional EVM functions and user-friendly development, while also providing the ability to utilize encrypted data for various operations such as addition, division, and comparisons. This confidential data can be used to derive valuable insights for non-developers, such as investors, without the requirement for decryption.

“As a provider of technology, we are thrilled to collaborate with the Inco team in order to introduce our innovative Fully Homomorphic Encryption (FHE) solutions to their protocol“, says Rand Hindi, who serves as an advisor to Inco and also holds the role of CEO at Zama, the foremost company in FHE research.

The company Inco has formed a beneficial alliance with Zama in order to advance the protocol. Additionally, its team of advisors includes prominent individuals such as Sandeep Nailwal, who is the Co-Founder of Polygon, and Anand Iyer, who serves as a GP at Canonical and is also a venture partner at Lightspeed Ventures.