ObfusCat is an AI-powered tool designed to enhance the security and confidentiality of code during AI-assisted code generation. It ensures that private code never leaves the local machine, adding a layer of protection by masking the code before sending prompts to ChatGPT and unmasking the responses upon return. This process keeps the semantic context of the code hidden, maintaining the privacy of sensitive information while leveraging the powerful capabilities of AI for code completion and bug fixing.