Phoenix Raises $15 Million and Launches Helium Testnet, Enabling Confidential Smart Contracts at Layer 2
TLDR
Data privacy-focused Ethereum Layer 2 network Phoenix has raised $15 million in a Series A funding round led by Hack VC, bringing its total funding to $22 million. Phoenix has launched an open testnet called Helium, which allows developers to deploy “confidential” smart contracts on the Phoenix Layer 2 network for the first time. The project uses Fully Homomorphic Encryption (FHA) technology from cryptography company Zama to enable end-to-end data encryption even at the processing level. Phoenix aims to maintain data privacy across the entire blockchain ecosystem and has partnered with EigenLayer to develop the FHE co-processor. The Phoenix mainnet is expected to launch in the first quarter of 2025, and the company has set up a grant program to attract developers to the testnet.
Phoenix, ( read our guide here ) developer of Ethereum's Layer 2 network focused on data privacy, recently announced the successful completion of a $15 million Series A funding round.
The round, led by Hack VC, saw participation from prominent investors such as Dao5, Amber Group, Primitive Ventures, GSR, Collider Ventures and Stake Capital.
Following a $7 million seed round in September 2023, this latest capital injection brings Phoenix's total funding to $22 million.
Alongside the funding announcement, Phoenix also launched an open testnet called Helium.
This milestone marks the first time developers will be able to deploy “confidential” smart contracts on the Fenix Layer 2 network.
The project uses Fully Homomorphic Encryption (FHA) technology from cryptography company Zama to enable end-to-end data encryption, even at the processing level. FHE is considered the “holy grail” of cryptography as it allows computation without the need to decrypt encrypted data.
Guy Itzaki, founder and CEO of Phoenix, emphasized the importance of privacy in the blockchain ecosystem.
“After scale, privacy is the next major hurdle Ethereum needs to reach mainstream adoption. FHE is an elegant solution to the cryptographic problem because it allows end-to-end computing of cryptographic data from existing encryption solutions based on zero-knowledge technology.”
Looking ahead, Phoenix plans to launch its main network in the first quarter of 2025. While details of the potential token launch have not been revealed, the company has set up a grant program to attract and support developers to test the potential of the TestNet network.
The exact amount of the program has not been finalized, but Itzhaky confirms that it will be high during the recent Serie A funding round.
Phoenix's long-term vision extends beyond its own Layer 2 network, as the company aims to drive data privacy across the entire blockchain ecosystem.
To achieve this goal, Phoenix has partnered with EigenLayer to develop the FHE co-processor. This co-processor acts as a stateless package that allows Layer 1 and Layer 2 networks to access FHE services with minimal modifications.
Fenix's focus on data privacy and its innovation in FHE technology make the project a promising player in the Ethereum ecosystem.
