Xata acquires Privacy Dynamics for advanced anonymization

Developers and agents alike can build faster and more reliably using production data, but access to production data is often extremely limited. This is why today, we're announcing that Xata has acquired Privacy Dynamics, bringing enterprise data anonymization to our Postgres development platform. Together, Xata and Privacy Dynamics bring reliability and governance to your organization's agent-led development projects, so you can continue to ship code with confidence.

Enhanced anonymization for Xata users

At Xata, we are committed to providing the infrastructure necessary to create safe agentic sandboxes for teams of all sizes. Using these isolated sandbox environments, AI agents can develop against production-like data without the fear of accessing sensitive customer information. For enterprises looking to enable agentic development internally, minimizing access to production data is a top priority.

Over the last 7 years, Privacy Dynamics built the most advanced anonymization engine in the industry, automatically detecting and classifying PII, preserving database relationships, and maintaining data accuracy, allowing developers to work with privacy-safe data without compromises. With Privacy Dynamics, Xata's anonymization solution is capable of satisfying expert determination requriements for HIPAA compliance, as well as data minimization requirements for GDPR and CPRA, all while preserving original data formats and referential integrity.

What Privacy Dynamics does

Privacy Dynamics creates and maintains an anonymized replica of your production database, satisfying data minimization requirements for GDPR, CPRA, HIPAA, and more. In practice, this process involves a number of sophisticated steps:

Automatic PII detection
Point Privacy Dynamics at a database and it identifies both direct identifiers (names, emails, addresses) and indirect identifiers - fields that might seem harmless individually but can present re-identification risk when joined. A unique combination of zip code, birth date, and gender in your users table? That would be flagged for treatment.

Relationship preservation
Your production database has several foreign keys, and anonymization that breaks referential integrity is useless. Privacy Dynamics transforms the data while keeping all relationships intact. Orders still link to users, addresses still link to accounts.

Realistic replacement
Anonymized values match the format of the originals. Names look like names, addresses look like addresses, emails have valid structure. Your application code runs against the anonymized data exactly as it would against production.

K-Based Micro-aggregation
If only one customer in your database is a 99-year-old in a specific zip code, it poses disclosure risk even without direct identifiers. Privacy Dynamics groups outliers with neighboring records (approximate nearest neighbor approach), moving the user to an adjacent zip code, or averaging two date of births, while minimizing distortion to the overall dataset.

Continuous sync
This isn't a one-time export. The anonymized replica stays current as production evolves, so your agentic sandboxes always reflect reality.

What's next?

Over the next several months, we will begin open sourcing the Privacy Dynamics anonymization engine and integrating select capabilities into the Xata Platform. We continue to be focused on helping developers and agents spin up sandboxes with safe, realistic data using Xata's branching and preview environment workflows.

As part of the acquisition, Privacy Dynamics' Founder and CEO, Graham Thompson, joined Xata as the Head of GTM.

AI agents are going to write a lot of code in 2026. Enterprises that want to enable agentic development shouldn't do it without safe agentic sandboxes powered by Xata! This is just the first of many exciting things to come in 2026. 🎉

--Monica Sarbu, Founder & CEO