The company showed off a prototype of a chip interconnect dubbed 'Sedna' at an open house of its Sun Labs research arm on Thursday.
Proximity computing allows chips and components to communicate without making physical contact.
The technique locates two areas at a distance of a few microns. Placing an electric charge on one of the surfaces is transmitted to the other chip, essentially creating a capacitor.
Nils Gura, a staff engineer at Sun Labs, claimed that the technique allows for connections 100 times more dense than current generation technologies.
Sun lost US government funding for its proximity computing project last November. The Defense Advanced Research Projects Agency instead chose to award grants to IBM and Cray to build a new class of super computer.
Bob Sproull, director for Sun Labs, downplayed the importance of the loss of funding, claiming that it "did not do anything irreversible".
The technology is largely completed, according to Sproull, and just needs to be implemented into actual products.
The Sedna project provides a first concept for packing the technology and could be implemented in a network switch. Other potential applications are in chip interconnects and cache memory.
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