Skip links

Table of Contents

Solidity and Homomorphic Encryption: The Key to Confidential Smart Contracts

Blockchain tech is a hive of activity, buzzing with ideas to make it safer and more private for everyone. Two prominent players in this arena are Solidity, the backbone of smart contracts, and homomorphic encryption, a revolutionary cryptographic technique. This article dives into their fascinating synergy, exploring how they can be combined to create a future of secure and confidential blockchain applications.


Imagine a vending machine that dispenses a soda only if you insert the correct amount and make the right selection. This is essentially the concept behind a smart contract – a self-executing program stored on a blockchain. Solidity, the brainchild of the Ethereum blockchain, is a programming language specifically designed to build these smart contracts. It allows developers to define the rules, conditions, and actions that govern interactions on the blockchain.

— Checkout our article on Solidity here.

However, a major concern with smart contracts is data privacy. Since all information is publicly viewable on the blockchain, sensitive details like financial data or medical records can be exposed. This is where homomorphic encryption steps in.

Homomorphic Encryption

Imagine encrypting a document in a way that allows you to search for specific keywords without ever decrypting the entire document. That’s the magic of homomorphic encryption! It’s a cryptographic technique that enables computations to be performed directly on encrypted data. In simpler terms, you can process information while it remains hidden, ensuring confidentiality.

Homomorphic encryption comes in two primary flavors, each catering to different needs:

  • Partially Homomorphic Encryption (PHE): Consider PHE the workhorse of the encryption world. It allows for specific mathematical operations, like addition and multiplication, to be performed on encrypted data. This makes it ideal for Web3 applications where calculations like financial interest or supply chain analysis are crucial, all while keeping the underlying data confidential.
  • Fully Homomorphic Encryption (FHE): FHE is the ultimate dream – it allows for any mathematical operation to be performed on encrypted data. Imagine being able to run complex algorithms or statistical analyses without ever revealing the underlying information! While FHE offers unparalleled flexibility, it comes at a cost. The computations involved are highly resource-intensive, making it less practical for current blockchain implementations.
solidity and homomorphic encryption

While FHE offers ultimate flexibility, it’s computationally expensive and not yet widely adopted for real-world applications. PHE, on the other hand, offers a good balance between security and efficiency, is a perfect fit for Web3 development. Here’s why:

  • Scalability: PHE operations are less computationally expensive compared to FHE, making them ideal for resource-constrained blockchain environments.
  • Real-World Applicability: PHE supports a wide range of operations relevant to Web3, including financial calculations, data aggregation, and privacy-preserving machine learning.
  • Active Development: Compared to FHE, PHE libraries and tools for Web3 development are more readily available and actively being improved.

Solidity Meets Homomorphic Encryption

Now, let’s get to the exciting part – how these two technologies can be combined. Here are some potential applications:

  • Private Transactions: Financial transactions on a blockchain could be encrypted using PHE, allowing calculations like balances and interest to be performed without revealing the actual amounts involved.
  • Confidential Medical Records: Medical data stored on a blockchain could be encrypted using PHE, enabling authorized parties to perform analysis without accessing the raw patient information.
  • Secure Voting Systems: Votes could be cast and counted on the blockchain while remaining encrypted, ensuring privacy and preventing vote tampering.

The potential benefits are vast. Imagine a future where sensitive data is processed securely on blockchains, unlocking new possibilities for healthcare, finance, and other privacy-critical sectors.

Challenges and the Road Ahead

However, integrating homomorphic encryption with Solidity comes with its own set of challenges:

  • Computational Complexity: Homomorphic encryption is computationally expensive. Smart contracts already have resource limitations, and adding homomorphic encryption computations could further slow down blockchain operations.
  • Limited Functionality: Currently, PHE libraries for Solidity are still under development, and the range of supported operations is limited.
  • Standardization: Homomorphic encryption is a rapidly evolving field. Standardizing libraries and protocols is crucial for widespread adoption.

Despite these challenges, ongoing research and development are paving the way for a more secure and private future. Here are some promising initiatives:

  • fhEVM: This project by Zama aims to create a virtual machine specifically designed for running confidential smart contracts using FHE.
  • HElib: An open-source library for homomorphic encryption that can be potentially integrated with Solidity.

Exploring Specific Use Cases

Let’s explore some specific use cases that could benefit from the integration of Solidity and homomorphic encryption:

  • Secure E-voting: Imagine a voting system where ballots are cast and counted on the blockchain while remaining encrypted. This would ensure voter privacy and prevent vote tampering. Homomorphic encryption would allow the encrypted votes to be tallied without revealing any individual votes.
  • Confidential Medical Research: Medical research often relies on large datasets of patient data. However, privacy concerns often limit access to this data. Homomorphic encryption could enable researchers to perform statistical analysis on encrypted medical records without compromising patient confidentiality. This could accelerate medical breakthroughs while protecting sensitive patient information.
  • Secure Supply Chain Management: Tracking the movement of goods through a complex supply chain can be challenging. Blockchain technology offers a solution by providing a tamper-proof record of each step in the process. However, some details, like product formulas or pricing, might be considered confidential. Homomorphic encryption could allow for secure tracking and analysis of sensitive data within the supply chain.

These are just a few examples, and the possibilities are endless. As both Solidity and homomorphic encryption evolve, we can expect even more innovative applications to emerge.

supply chain management

The Ethical Considerations

While homomorphic encryption offers numerous benefits, it also raises ethical concerns. The ability to process data without decryption opens up possibilities for mass surveillance and data analysis on a previously unimaginable scale. It’s crucial to develop clear regulations and ethical frameworks to ensure this technology is used responsibly, prioritizing user privacy and preventing misuse.


Solidity and homomorphic encryption represent a powerful duo with the potential to revolutionize the world of blockchains. By enabling secure and confidential data processing, they can unlock a new wave of innovative applications that prioritize user privacy. While challenges remain, ongoing research and development are pushing the boundaries, paving the way for a future where blockchains offer both transparency and confidentiality. As this technology matures, we can expect to see a surge in secure and user-centric blockchain applications, transforming the way we interact with data and conduct transactions in the digital age.



What is homomorphic encryption in blockchain?

  • Homomorphic encryption allows computation on ciphertexts, producing encrypted results that, when decrypted, match operations as if they were done in plaintext.

How does Solidity utilize homomorphic encryption for smart contracts?

  • Solidity can integrate homomorphic encryption to develop smart contracts that execute and manage encrypted transactions without revealing data.

What are the benefits of using homomorphic encryption in smart contracts?

  • It enhances privacy and security, ensuring that contract details and transaction values remain confidential and secure from unauthorized access.

What challenges face the implementation of homomorphic encryption in blockchain?

  • Issues include performance overhead, complexity in integration, and the need for extensive computational resources.

Can homomorphic encryption be used with any blockchain platform?

  • While theoretically possible, practical implementation is mainly seen in platforms like Ethereum that support complex smart contracts and encryption protocols.

What is Solidity?

  • Solidity is a programming language designed for developing smart contracts that run on the Ethereum blockchain and other blockchain platforms.

What are smart contracts?

  • Smart contracts are self-executing contracts with the terms of the agreement directly written into code, which automatically enforce and execute the terms.

How does blockchain enhance security in digital transactions?

  • Blockchain technology uses decentralized and cryptographic principles to ensure that each transaction is immutable and secure from tampering.

What is the future of blockchain privacy technologies?

  • Emerging technologies like zero-knowledge proofs and enhanced encryption methods are set to further improve the privacy and security of blockchain transactions.

Why is privacy important in blockchain transactions?

  • Privacy ensures sensitive data protection, maintains user anonymity, and prevents unauthorized access, essential for trust and security in blockchain networks.

Metana Guarantees a Job 💼

Plus Risk Free 2-Week Refund Policy ✨

You’re guaranteed a new job in web3—or you’ll get a full tuition refund. We also offer a hassle-free two-week refund policy. If you’re not satisfied with your purchase for any reason, you can request a refund, no questions asked.

Web3 Solidity Bootcamp

The most advanced Solidity curriculum on the internet!

Full Stack Web3 Beginner Bootcamp

Learn foundational principles while gaining hands-on experience with Ethereum, DeFi, and Solidity.

You may also like

Metana Guarantees a Job 💼

Plus Risk Free 2-Week Refund Policy

You’re guaranteed a new job in web3—or you’ll get a full tuition refund. We also offer a hassle-free two-week refund policy. If you’re not satisfied with your purchase for any reason, you can request a refund, no questions asked.

Web3 Solidity Bootcamp

The most advanced Solidity curriculum on the internet

Full Stack Web3 Beginner Bootcamp

Learn foundational principles while gaining hands-on experience with Ethereum, DeFi, and Solidity.

Learn foundational principles while gaining hands-on experience with Ethereum, DeFi, and Solidity.

Events by Metana

Dive into the exciting world of Web3 with us as we explore cutting-edge technical topics, provide valuable insights into the job market landscape, and offer guidance on securing lucrative positions in Web3.

Start Your Application

Secure your spot now. Spots are limited, and we accept qualified applicants on a first come, first served basis..

Career Track(Required)

The application is free and takes just 3 minutes to complete.

What is included in the course?

Expert-curated curriculum

Weekly 1:1 video calls with your mentor

Weekly group mentoring calls

On-demand mentor support

Portfolio reviews by Design hiring managers

Resume & LinkedIn profile reviews

Active online student community

1:1 and group career coaching calls

Access to our employer network

Job Guarantee