Zama adds 16 confidential vaults to Morpho

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Zama expands private DeFi

Highlights

Zama is opening 16 confidential Morpho vaults.
Its first vault reached $40 million TVL in seven weeks.
Deposits include USDC, USDT, AUSD, and TGBP.
Private swaps are launching alongside the vaults.

The 16 vaults open for deposits on Sept. 15 and support assets including USDC, USDT, AUSD, and TGBP, The Block reported. Twelve provide confidential access to existing Morpho vaults on Ethereum, while four were built specifically to accept confidential deposits.

Confidential vault lineup grows

The expansion follows Zama's first confidential vault, launched in June with Morpho and Steakhouse Financial. Using Steakhouse's USDC Prime strategy, the vault grew from zero to $40 million in total value locked within seven weeks.

Steakhouse will curate some of the new vaults. Armitage by Wintermute, Flowdesk, RockawayX, and Bitwise are also participating as curators, broadening the range of strategies available through the confidential structure.

The underlying idea is to give users access to onchain yield without making their positions and strategies publicly visible. That distinction is particularly relevant for institutional investors and corporate treasuries, whose activity on public blockchains can otherwise expose balances and portfolio movements to other market participants.

The vaults will initially be available through Zama's application. Utila, Zerion Wallet, and Yield.xyz are expected to integrate them in the coming weeks.

Private swaps arrive on Ethereum

Alongside the vault expansion, Zama is launching the Zama Swap Protocol, adding confidential swaps directly on Ethereum. The system initially covers cUSDC, cUSDT, cAUSD, and cTGBP as well as shares issued by the confidential vaults.

Users can exchange those assets and positions without publicly revealing the size of a transaction or the intention behind it. The feature addresses a basic limitation of transparent blockchains, where wallet balances and transaction flows can often be observed in real time.

The combination of private swaps and confidential vaults means users can move between supported assets and yield positions while limiting the amount of portfolio information exposed publicly.

Privacy becomes a DeFi infrastructure test

Zama's expansion provides a larger test of whether blockchain confidentiality can attract capital without requiring investors to abandon existing DeFi infrastructure. Rather than creating an isolated lending market, the project is adding a privacy layer to established Morpho strategies and liquidity.

The early numbers give the experiment some scale: the first vault accumulated $40 million in seven weeks, and the lineup now expands to 16 vaults across four deposit asset classes. The next measure will be whether that demand extends beyond the initial USDC product as confidential swaps and additional integrations become available.

Earlier, we reported that Zama and T-REX launch privacy infrastructure for tokenized assets.

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