The Future of Fully Homomorphic Encryption (FHE): Key Trends to Watch

This year, Fully Homomorphic Encryption (FHE) is poised to be a game-changer in the world of privacy-enhancing technologies (PETs). FHE allows data to remain encrypted even while being processed, ensuring that sensitive information is protected throughout its lifecycle. While it’s still early days, we’re on the verge of seeing FHE go mainstream, especially with the support of hardware acceleration, venture capital investment, and industry collaborations.

In this blog, we’ll look at three major trends expected to shape the adoption of FHE over the next two years.

1. FHE Adoption Will Begin with AI and Blockchain

AI and blockchain are the two industries most likely to adopt FHE first. AI requires massive amounts of data processing, and privacy is a top concern for companies in this space. FHE offers a way to keep data secure during computations, making it a key solution for AI providers looking to offer enterprise clients a trustworthy service.

Blockchain, on the other hand, faces its own privacy challenges. Public and immutable ledgers prevent some types of privacy-sensitive activities, and compliance with regulations like GDPR and HIPAA is difficult. FHE will allow for private transactions and smart contracts, enabling use cases such as private decentralized finance (DeFi) and confidential auctions.

With the resurgence of the crypto market and a renewed interest in blockchain technologies, FHE is expected to see rapid adoption in these sectors.

2. Law Enforcement Will Embrace Widespread Encryption

While law enforcement agencies have long been wary of encryption, the increasing number of cyberattacks and data breaches has changed the narrative. For example, the “Salt Typhoon” cyberattack highlighted the need for widespread encryption to protect sensitive data from malicious actors.

However, encryption poses challenges for law enforcement, as it can prevent access to crucial evidence. FHE offers a solution by allowing agencies to analyze data without compromising privacy. With FHE, regulatory bodies can conduct audits, and law enforcement can investigate crimes without exposing individuals’ private information unnecessarily. This balance between privacy and security could be a significant breakthrough for both industries.

3. Collaboration Will Drive FHE’s Success

In the past, security solutions were often developed in secrecy, leading to vulnerabilities that were only discovered after widespread adoption. FHE will not follow this path. Its success hinges on open collaboration among hardware and software providers, industry standards organizations, and other stakeholders.

Rather than developing proprietary systems, FHE providers are already working together to create open standards for interoperability, best practices, and optimization guidelines. These efforts, led by consortia and industry groups, will ensure that FHE solutions are secure, scalable, and easier to implement. Open standards will also help build trust and foster broader adoption across industries.

Conclusion: A Fast-Paced Future for FHE

The stage is set for FHE to make a significant impact in 2025 and beyond. Industries like AI, blockchain, and law enforcement are beginning to recognize the value of FHE, and collaborative efforts are underway to make it more accessible and effective. As these trends unfold, we can expect to see real-world applications of FHE emerging rapidly, with mainstream adoption following closely behind.

In the coming years, FHE could become the foundation of privacy and security in the digital age, offering a powerful solution to the growing challenges of data protection in an increasingly interconnected world.