[DigitalToday reporter Chi-gyu Hwang] Crypto infrastructure firm Zama, DeFi protocol Morpho and asset manager Stakehouse Financial are launching a DeFi product on Ethereum for the confidential USDC stablecoin, called the Stakehouse Confidential USDC Prime Vault.

According to a recent report by The Block, the integration will allow holders of Zama’s crypto token cUSDC to earn yield by depositing directly into Morpho’s existing Stakehouse USDC Prime Vault without exposing balances, transaction amounts or strategies on-chain.

Zama co-founder and CEO Rand Hindi (랜드 힌디) said operating on a public blockchain had so far been like exposing all financial strategies to competitors. He called the launch of the Confidential USDC Prime Vault the official starting point for Ethereum’s “confidential DeFi” sector.

Vault deposits will begin on June 23 through the Zama app. cUSDC supports audit and compliance checks while masking balances and transfer amounts using fully homomorphic encryption technology.

Converting regular USDC into cUSDC will also take place directly on Ethereum, without needing to move to another chain.

Morpho co-founder Merlin Egalite (메를랭 에갈리트) said institutional clients have consistently demanded on-chain confidentiality. He said Zama’s technology stack makes it possible to allocate funds to Morpho vaults without compromising operational privacy.

Zama last month acquired TokenOps to secure crypto token distribution capabilities for institutional issuers. In March, it worked with the Apex Group-backed T-REX Network to apply a homomorphic encryption layer to tokenised real-world assets.