Confidential computing technologies have the potential to unlock the next $1 trillion in capital for the cryptocurrency ecosystem.
Advances in privacy technologies, such as fully homomorphic encryption (FHE), could drive this growth, according to Remi Gai, founder of Inco.
Speaking exclusively to Cointelegraph during the FHE Summit 2024, Gai stated: “There’s the next trillion dollars of opportunities because if you think about what we’re building, it’s enabling creators to build more applications. So first, we’re growing the pie of what’s possible in Web3.
A lot of these use cases in Web2 just cannot work in Web3 because we’re missing this confidentiality aspect.”
Inco is a modular confidential computing network that builds FHE-based solutions, aiming to become the confidential computing layer of the blockchain.
For the crypto space to achieve mass institutional adoption, greater privacy is essential.
Mainstream institutions are often hesitant to join the decentralized finance (DeFi) space due to the lack of privacy in Web3. Confidential computing technologies could change this, as Gai explained:
“Institutions are still having a hard time entering the space because everything is transparent.
Now, if you enable an experience similar to what they’re comfortable with in Web2, suddenly this could bring a lot more liquidity, use cases, bigger participants, and money to enter the space.”
Gai emphasized that encryption is not about anonymity but about securing valuable information.
He likened it to the secure sockets layer (SSL) of the internet, saying:
“If blockchain is the value layer of the internet, then you need the SSL equivalent. A lot of people still think encryption means anonymity.
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“No, it just means that you need to take certain pieces of information that are valuable through encryption.
“And that is what we’re missing today.”
Advancements in confidential computing will not only attract institutional investors but also retail investors.
Gai mentioned that new use cases created by these technologies would bring additional liquidity from both sectors:
“If you think about the new use cases it will create, it will also attract net new users.
“That will also bring in liquidity. So it could also trickle down to retail. It doesn’t have to be just institutions.”
The influx of new liquidity will largely depend on the disruptive potential of the use cases introduced by confidential computing advancements.
These technologies promise significant benefits for financial institutions by enabling computations on encrypted data without decryption, exemplified by fully homomorphic encryption (FHE) solutions.
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