Fhenix Launches Confidential Computing on Ethereum and Arbitrum

Fhenix launched confidential computing technology for smart contracts on Ethereum and Arbitrum on October 21, 2026. The launch includes CoFHE – Fhenix's fully homomorphic coprocessor, which allows smart contracts to process encrypted information without revealing the underlying data. The technology aims to address the openness issue of public networks, which complicates the use of applications in the financial sector that rely on confidentiality. Fhenix estimates the potential token issuance, limited by current privacy conditions, at $1.5 trillion.

CoFHE performs resource-intensive encrypted operations off-chain and then returns the results to smart contracts on Ethereum and Arbitrum. The system's throughput adapts to demand rather than restricting applications with a fixed processing speed. For developers, Fhenix simplifies implementation: the approach uses Solidity imports and encrypted data types that should work like regular variables, allowing privacy to be embedded into the existing smart contract development process.

A key element of the launch was the dual-mode token architecture: holders can switch balances between public and confidential modes in a single transaction, without wrapping the asset and without transferring through a bridge. Since the token remains on the original blockchain, the approach maintains compatibility with existing wallets, exchanges, and decentralized finance protocols.

"When I started Fhenix three years ago, I couldn't imagine how far it would take us," said the company's founder, Guy Ziskind. "CoFHE now operates on the Ethereum and Arbitrum mainnets with competitive performance and an interface simple for any developer needing privacy in a decentralized application." Ziskind also mentioned that Fhenix is working with Tandem on a confidential stablecoin, but did not provide details about the development or release timelines.

The launch includes two initial development partners. Fluton is creating a privacy engine for interaction between blockchains, applications, and assets using encrypted intents. Alpha Engine is developing a confidential network for on-chain finance, where strategists can submit encrypted strategies and compete for liquidity without revealing their trading approaches. Fhenix reported that both projects underwent technical reviews and security checks before launch, and the system was audited by Consensys Diligence. The announcement highlighted additional security considerations for systems where smart contracts operate with information they cannot directly read, although a representative from Consensys Diligence was not named.