"CT Chinese · Crypto Circle Open Mic" is a monthly audio interview program created by Cointelegraph's Chinese site, held every two weeks. The show invites core practitioners and observers from various fields such as blockchain, Web3, DeFi, stablecoins, the Ethereum ecosystem, and policy regulation to enter the studio and discuss industry hotspots, market dynamics, and in-depth viewpoints. In a relaxed and open dialogue atmosphere, it presents a more authentic, diverse, and cutting-edge crypto world to the audience. The theme of this episode is: The Privacy Revolution on Transparent Chains: Technology, Market, and Token Opportunities. Our guests are three well-known KOLs from the Chinese community: Crypto Peter; Calm Brother Loves Dog Meme; The Moon Dojo 🇭🇰.
(Audio transcription has been processed by AI, with some content edited and modified. For the complete audio, please visit the X platform to listen.)
Host Eva:
Hello everyone, welcome to this episode of Cointelegraph Chinese's Crypto Circle Open Mic. I am your host, EVA. Today, we will discuss the theme: The Transparent Revolution on Privacy Chains: Technology, Market, and Token Opportunities. Our three guests today are: Calm Brother Loves Dog Meme, Crypto Peter, and The Moon Dojo — welcome!
Recently, the privacy sector suddenly became the market focus: from the price and attention triggered by Zcash's halving and protocol upgrade to the price fluctuations and network upgrade discussions of Monero at various points in time, the entire sector's heat has clearly rebounded.
Among them, Zcash's halving and related technological advancements are seen as important catalysts for increasing capital attention, while there have also been noteworthy shifts in regulatory aspects — for instance, the sanctions direction of Tornado Cash has faced legal and policy controversies and adjustments in 2025, bringing the privacy topic from the "underground" to mainstream discussions.
Today, we will explore several main lines: technology (such as ZK and protocol upgrades), market (capital flow, volatility, and narratives), and token opportunities (which projects may truly benefit in the long term). If the audience present and online readers have questions, feel free to post them in the comments, and we will throw the questions to our three guests.
Before we officially start the Q&A session, let's have our three guests greet our audience.
Calm Brother:
I am very happy to be invited to this Cointelegraph space to discuss the topic of privacy with everyone.
Peter:
I am Crypto Peter. I have been navigating the crypto market for about three years. I am involved in community building, and our community mainly focuses on earning rewards. Everyone gathers in Web3 by chance, and we are all here to make money. So, I am very honored to be invited by Cointelegraph to discuss privacy tokens today. I hope to bring you an exciting AMA.
The Moon Dojo:
Thank you, host. I am The Moon Dojo, an ambassador for CDEX. Our project is based on the Particle Network's universal account, designed as an intent-driven full-chain DEX. In simple terms, users do not need to manage multiple chains' private keys to operate their crypto assets and RWA assets. Through a unified smart account, users can express their intent to seamlessly exchange a token on the Ethereum mainnet for tokenized stocks on another chain. At the underlying level, the Particle chain will serve as a settlement layer to automatically handle complex cross-chain exchanges and authorization operations. I am also very honored to participate in today's discussion on the privacy sector topic. As a trader, I pay attention to various tracks, and the privacy sector is indeed gaining more attention, so I look forward to sharing more with everyone.
Host Eva:
We will now officially enter the Q&A session of this AMA. This round, the privacy sector has suddenly returned to the spotlight. What do you see as the core driving forces? Is it a resurgence of narratives, capital seeking new mainlines, or have user demands genuinely changed?
The Moon Dojo:
I believe there are at least three forces driving this.
First is the arrival of technological foundations. The early privacy technologies, such as early ZK-SNARKs, were powerful but expensive and not very efficient. Now we are at a technological foundation point. For example, the engineering maturity of ZK technology has improved the generation speed of zero-knowledge proofs and significantly reduced costs. This makes it possible to embed privacy computing into DApps, moving beyond just the basic stage of anonymous transactions.
The second is the emergence of new paradigms, such as the cutting-edge technology of Fully Homomorphic Encryption (FHE). Although we are far from large-scale adoption, it has entered the sights of capital and research and development, depicting the ultimate vision of data being usable but invisible, thus broadening the imagination ceiling of the privacy track. Therefore, the technological feasibility is the cornerstone of this round of explosion. It has transformed from a purely philosophical concept into a practical engineering problem. The third point I believe is the awakening of value; user demands have changed. It is no longer just about not wanting to be tracked; on-chain identity has taken shape and possesses significant commercial value. The third factor is the fairness of capital; previously, it was a marginal track. After the mainstream narratives of public chain DeFi and GameFi became extremely competitive and saturated, smart capital began to seek structurally high-odds opportunities. The privacy track possesses such elements — structure, high technical barriers, and long-underestimated value, thus having enormous room for catching up.
The third point is clear value capture, as privacy computing networks can charge gas fees and service fees, making the value model very clear. Therefore, it is not just a simple rotation of funds. It is more like capital completing a reassessment of the track, discovering the laws of value, and making strategic layouts.
Peter:
Thank you for the host's question. I would like to add to what The Moon Dojo just said. First, I believe that the explosion of the privacy sector in 2025 is not a coincidence, nor is it simply an emotional rotation; it is the result of multiple factors working together.
First, the rapid global regulatory environment this year is the biggest driving factor. We know that in mainland China, for example, a new round of crackdowns began in November, including some mainstream exchanges like OK, whose Xiaohongshu account has been banned. This year, not only in mainland China but also in the US, EU, and South Korea, regulators are accelerating the push for data transparency in CEX exchanges and on-chain compliance asset traceability, which has made users' basic privacy needs shift from "not being noticed" to "a necessity."
Especially when these institutions begin to realize that legal compliance does not equal complete transparency. Many cross-border funds, including enterprise-level asset management and family office investments, do not want their trading strategies and addresses publicly exposed online. In the past, the privacy track or privacy coins were merely speculative for individual retail investors. Now, institutions need some assets that are secure but do not expose strategies. Secondly, I believe the narrative has seen some heat adjustments, or the heat is not as intense as before. Capital must seek new high-volatility sectors to carry it. Therefore, I believe the privacy sector has advantages such as small market capitalization and significant future development potential, making it a field where capital can easily create trends. Thus, I think the explosive rise of the privacy sector, or its gradual entry into the public eye, is the result of these three factors working together.
Host Eva:
I would like to ask Peter again, how do you view the renewed activity of established privacy coins like Monero and Zcash in 2025? Are they "old trees sprouting new buds," or merely short-term emotional amplifiers for capital?
Peter:
Initially, I believe the revival of these established privacy coins this year is not just a revival of old emotions but a typical case of what we call old narratives regaining new value. Their packaging has not changed, but what is inside has changed. First, as I mentioned earlier, their demand for privacy has never disappeared; it has just been overshadowed by new narratives. Previously, during the National Day holiday, some meme tokens, like Binance Life, were very popular. When these secret tokens or other sectors, whether AI agents or DeFi, or fan tokens, were hot, privacy tokens were overshadowed. However, as I mentioned in the first question, when the heat of these sectors gradually recedes, or when there are not as many retail investors paying attention to these sectors, the priority of the privacy sector rises.
In the past few years, the market has been distracted by L1, L2, or AI, but for underlying users like you and me, the demand for anonymous trading or account protection has always existed. People prefer to trade in places that do not require KYC or are anonymous for a sense of security. Especially in 2025, as regulations become stricter, the demand for basic privacy tokens among users has surged. As established privacy coins, they have been operating for a long time and can be considered the most mature alternative in the privacy sector.
Secondly, these projects, whether Monero or others, have undergone years of upgrades and iterations, and they are no longer products of the old era. They have introduced new architectures, proving that their systems can be accelerated. It is evident that their technology has not stagnated but has been continuously optimized, and the project teams have been actively working. Therefore, in this context, the revival of established tokens is inevitable. They are not a flash in the pan but are core assets in the cyclical evolution of the privacy sector. When retail investors pay attention to the privacy sector, these established or leading tokens are not just old trees sprouting new buds; their roots have become more stable, and when another wave of new capital comes, their roots will absorb water the fastest.
Calm Brother:
Regarding the performance of Monero and Zcash this year, I believe it needs to be understood in layers — they have the substantial foundation of "old trees sprouting new buds," but there is indeed a component of short-term capital speculation.
First, let's look at the fundamental data. By the end of this month, Monero's market capitalization is actually over $7 billion. The price is around $400, and its increase is relatively low, only 16%, with a cumulative increase of 51% over 90 days.
Now, looking at Zcash's market capitalization, it is close to $6 billion, with a price of over $300, and its volatility is very high. On the 21st of last month, it surged to over $700 but then plummeted. This difference in price trends reveals the essential differences between these two coins.
From the on-chain data perspective, Monero demonstrates real usage demand, with its daily average transaction volume stabilizing around 30,000 transactions and a year-on-year growth of 15%. This is quite rare, especially against the backdrop of regulatory crackdowns and a significant decline in exchanges. Additionally, we know that Monero has a 10% premium in the OTC market, indicating a strong non-KYC demand. In contrast, Zcash's on-chain transaction volume is only one-fifth of Monero's, and its transaction peaks are often linked to exchange activities and price fluctuations, suggesting that Zcash has a stronger speculative nature.
Looking at the technological iteration, last month Monero released the Fluorine Fermi version upgrade, aiming to achieve greater anonymity and anti-quantum computing capabilities by 2026. Zcash also underwent upgrades, optimizing some of its shielded address PRC functions. These upgrades represent substantial technological progress, not merely marketing hype, but the market structure tells us another story.
In 2025, both Monero and Zcash began relaunching perpetual contracts on multiple exchanges, including Binance, Bitget, Bybit, etc., which successively opened perpetual trading for SMR and ZC. This attracted many contract players to leverage or engage in short-term operations. Notably, we saw Zcash surge from the end of September to November 21 this year, with its market capitalization briefly exceeding that of XMR, only to experience a subsequent drop of over 50% within a week. This trend clearly exhibits the characteristics of an emotional amplifier, utilizing the privacy narrative for speculation, attracting retail investors, and ultimately leading to a rapid retreat. Therefore, my conclusion is that Monero is closer to the idea of "old trees sprouting new buds," while ZEC currently leans more towards being a short-term emotional amplifier. Monero itself has strong anti-censorship properties and has gained steadfast support from core users under high regulatory pressure. Its value proposition is decentralized cash, which does not rely on transaction volume for survival. Although Zcash's optional privacy model is more compliant and user-friendly, it also makes it more dependent on institutional narratives and liquidity from major exchanges, making it very susceptible to capital manipulation. In summary, I believe Monero is more suitable for long-term holding, while Zcash is closer to swing trading. In the long run, I think Monero's resilience against regulation and its technological path will be more solid, while in the short term, Zcash offers more trading opportunities but also carries significant risks. These are my thoughts.
Host Eva:
The privacy sector has always been considered "having demand but lacking large-scale adoption." Do you think we are now at a real turning point? What signals make you feel this round might be different from the past?
The Moon Dojo:
I believe we are indeed at a turning point. There are three obvious signals we can observe.
First, privacy projects like Monero and Zcash have established relatively independent, isolated privacy worlds. However, this liquidity may be fragmented, and the ecosystem may be quite isolated, making large-scale adoption difficult. Currently, the new generation of privacy solutions has a core idea that is becoming visible: becoming a privacy layer for existing public chains without requiring users to migrate assets and ecosystems, but simply providing a plug-and-play privacy service. This is very similar to the internet upgrading from HTTP to HTTPS; you don't need to change browsers or access different network applications; developers just need to integrate it into a secure layer. This integrated paradigm will significantly lower the adoption threshold. Thus, we are witnessing a shift from island-like privacy to integrated privacy, which is the first signal.
The second signal is the transition from functional anonymity to programmable privacy. Previously, when discussing privacy, about 90% of the conversation revolved around anonymous transactions. However, due to the development of ZK technology, we are now discussing more about programmable privacy. This means developers can more precisely control which parts of the data can be hidden, which parts can be public, and to whom they can be disclosed. This could give rise to many new application scenarios. For example, privacy DeFi can hide your trading strategies and positions. Privacy DAOs can prevent votes from being bought or threatened, and there are on-chain identities, privacy social networks, and private social interactions. When privacy evolves from a single function into a development tool that empowers countless applications, its value becomes not just linear but potentially exponential.
The third signal is the shift from retail ideals to the essential needs of whales and institutions. In the early days, privacy was pursued by geeks and idealists, but now I believe it will become a core risk control tool for on-chain whales and future institutional entrants. No institution would want to fully expose its core trading strategies, capital allocation paths, and portfolio compositions to competitors. Therefore, on a transparent chain, they lack privacy. To protect such business secrets and asset security, the demand for privacy solutions is real and urgent. Thus, when smart money starts paying for privacy, this sector will truly have a commercial foundation. In summary, I believe this is different because privacy is evolving from a product to a platform, from an optional feature to a necessity.
Peter:
I think that in 2025, when you say it is a true turning point for the privacy sector, there is some truth to that. The biggest difference from the past is that privacy is beginning to shift from being a personal tax evasion tool to a mainstream Web3 infrastructure, meaning it is becoming more accessible to the public.
First, privacy is transitioning from a singular demand to a system-level demand. In the past, privacy was mainly used by ordinary users, such as retail investors avoiding being tracked, or members of community DAOs protecting their voting data, sometimes through anonymous voting. This also included some smart money or whale addresses avoiding exposure. These were the primary functions of privacy in the past.
However, by 2025, which is now, privacy has upgraded to a system-level demand. This includes DEX or CEX trading strategies, on-chain decision-making for AI agents, cross-border payments, and the distribution of wallets or assets for investment institutions. Our entire Web3 is transitioning from open to selectively transparent, which is a qualitative change.
Secondly, I believe privacy is no longer viewed as a form of anti-regulation but rather as a more regulatory-friendly tool. The new regulatory trend requires not complete transparency but verifiability. Whether through KYC or various email verifications, privacy is essentially in opposition to regulation. However, I believe the value system of the privacy sector is changing. Users starting to use privacy products is the true manifestation of the current turning point in the privacy sector in 2025. Therefore, this round of privacy market activity is not speculation but a natural evolution of demand in the current crypto market.
Host Eva:
Whenever there is significant market volatility, privacy coins are often one of the leading sectors in either rising or falling. As an industry KOL, do you think the volatility of privacy assets comes from narratives, mechanisms, or the characteristics of capital structure?
Peter:
I believe the volatility of privacy assets, as the host mentioned, is influenced by narratives, mechanisms, and capital structure; I think all three play a role. However, I believe the capital structure is the core variable. First, let's talk about narratives. Privacy is a sector that easily forms extreme emotions. When some people's privacy is exposed, it creates discomfort and emotional reactions. Privacy has a distinct binary narrative. It is either seen as a foundational infrastructure for freedom or as the sector with the highest regulatory risks. Therefore, it is met with mixed reviews in the market.
This narrative conflict leads to two major characteristics. First, retail emotions fluctuate significantly, whether regarding privacy tokens or privacy regulations. Secondly, panic emotions are particularly concentrated; for example, if a project has a privacy issue, everyone will wonder how that project could have such a problem, right?
Secondly, I believe privacy assets generally have a higher difficulty of decentralization. Their market capitalization is relatively low; as I mentioned earlier, they currently have a low market cap and significant room for development. Additionally, their liquidity is not very good at the moment. Therefore, I think privacy assets, as a relatively niche sector, have very weak substitutability. So, regardless of which privacy asset project it is, any positive or negative news will quickly amplify.
Now, regarding the capital structure, due to the unique nature of the privacy sector, it naturally attracts some high-risk preference funds, and its participant composition is quite unique. First, there are high-frequency quant traders who pay great attention to their privacy. Secondly, there are emotional funds chasing narratives and explosive points, as well as large funds and whale capital, which leads to a very high turnover rate in the privacy sector. The privacy sector is not one that ordinary investors frequently pay attention to. Its high volatility is not a disadvantage; rather, it is an inevitable characteristic of being a core asset of freedom in Web3.
The Moon Dojo:
I believe the volatility of privacy assets can be viewed from three aspects, which are actually interrelated and mutually amplifying. For example, from the narrative perspective, narratives have high elasticity because privacy is a sector that heavily relies on grand narratives. In a bull market or when the market is pursuing technological frontiers, it can be interpreted as the ultimate form of Web3 or as defenders of digital sovereignty, which can assign high value. However, in a bear market or when regulatory pressures increase, it can be labeled as a sector for illegal money laundering, leading to panic selling. Thus, from a narrative standpoint, it is highly elastic and sensitive to changes in market sentiment, rising rapidly and falling just as sharply.
Secondly, from a mechanism perspective, it is also a very important aspect. The core mechanism of privacy coins is anonymity, which inherently creates significant information asymmetry. For mainstream assets like Ethereum and Bitcoin, people can use on-chain analysis tools to track capital movements, inflows and outflows from exchanges, and chip distribution to make market judgments. However, for strongly private assets, these tools are almost completely ineffective. You cannot know whether a whale is quietly accumulating or offloading, nor can you tell how many coins are sitting in cold wallets. Therefore, the market is essentially in a state of information black box. When consensus forms, prices can soar due to a lack of resistance. However, when panic strikes, it can lead to a stampede due to unfalsifiable suspicions. Anonymity, while protecting users, also deprives the market of a stabilizing factor, thereby amplifying volatility.
From a funding perspective, the early participants in the highly homogeneous privacy sector are not typically areas that ordinary investors would engage with too early. Instead, they often consist of a group of strong believers, tech enthusiasts, and high-risk tolerant investors. Therefore, this holding structure is also highly homogeneous, which can be described as a structural characteristic of high consensus and low liquidity. High consensus means that during an upward cycle, holders will absorb selling pressure, making it easier to form a short squeeze. Low liquidity means that when the market turns, the actions of a few large holders or market makers can cause significant price impacts, as the depth of buy and sell orders is relatively insufficient. Thus, prices can be easily influenced by a small amount of capital, exhibiting extremely high volatility. In summary, the high elasticity of narratives acts as an amplifier, the information black box of mechanisms serves as a catalyst, and the high homogeneity of capital acts as a powder keg. The combination of these three elements creates a liquidity in privacy assets that far exceeds other sectors.
Host Eva:
In your view, Moon, will mainstream crypto applications in the future make privacy a standard basic feature, or will it still rely on specialized privacy coins? Why?
The Moon Dojo:
I believe both will exist, and it may form a mixed structure where basic layers are standardized and application layers are specialized. From a technical standardization perspective, it will definitely be a built-in safety cushion within Layer 1 and Layer 2. All public chain protocols will need to have some form of lightweight privacy functionality as a standard feature, much like the standard safety airbags in today's cars.
This is reflected first in the ability to resist MEV (Miner Extractable Value). For example, using cryptographic memory pools or threshold encryption technology to protect transactions from being front-run at the protocol level. It does not require a specialized privacy coin but becomes part of the core competition of the public chain itself. It has its own native token, such as Ethereum, to ensure security and pay fees. Then there is the basic transfer privacy, which requires an optional stealth mode transfer function to provide basic privacy protection for ordinary users. The goal of these basic functional layers is to address the most common and fundamental privacy pain points. They will sink down to the foundational infrastructure layer, becoming seamless and widespread.
Secondly, I believe that the application layer will require specialization, needing dedicated privacy protocols and tokens to dominate the high-performance privacy computing market. This is similar to how the built-in drawing tools of an operating system cannot replace professional software like Photoshop. High-performance privacy DApps, such as fully private decentralized exchanges, represent complex on-chain strategy games that need to handle vast amounts of private data in decentralized social networks. The intensity of privacy computing and logical complexity will far exceed the basic functionalities provided by the foundational layer. Furthermore, for the high-performance privacy computing demand, we need specialized privacy protocols to meet this need, and the tokens of these protocols will play a very important role—they include payment methods, as well as payment for complex privacy computations, such as staking and ordering rights, used for decentralized ordering and the economic security of proof networks.
Ultimately, this structure will see privacy everywhere, but in different forms. Just like how we use electricity today, you don’t care about the infrastructure of the national grid, but you might pay for various high-performance appliances and specialized applications in your home. Therefore, future users will likely enjoy the basic privacy protection provided by public chains by default, while developers will choose specialized privacy protocols and tokens to build truly revolutionary applications that protect user data sovereignty.
Host Eva:
For ordinary users, what do you think is the biggest misconception about using privacy coins? What would be your first piece of advice for new users?
Calm Brother:
This question is very sharp, and I think it may contain elements of a wealth code. In fact, I have been researching privacy coins for a long time, and I believe there are three projects currently worth paying attention to—Railgun, ZANO, and HORIZEN (ZEN). These three projects represent three key directions: the DeFi privacy layer, the next generation of privacy Layer 1, and a modular privacy platform.
First, Railgun currently has a market cap of around $200 million, and it is based on a zero-knowledge proof privacy system. It allows users to perform private DeFi operations on chains like Ethereum and BSC. This means you can use these protocols while protecting your privacy. Its positioning is very unique because traditional privacy coins are independent chains that cannot interact with the DeFi ecosystem. So why am I optimistic about Railgun? I believe there are three catalysts.
The first is that Vitalik endorsed this project. In November, Vitalik donated $2.9 million worth of Ethereum to this privacy communication application using this protocol. I think this is a top-level trust endorsement. The second is the integration by the Ethereum Foundation. In October, it was included in the privacy wallet toolkit, leading to a price surge of 300%. The third is its actual usage data; by 2025, the entire protocol had completed $1.6 billion in shielded transaction volume, with a cumulative total of $4 billion. Therefore, I believe Railgun's story is that DeFi needs a privacy layer, making it quite promising.
The second is ZANO, which has a comprehensive technical advantage. It not only offers private transfers but also on-chain voting, etc. Its positioning is as an enterprise-level privacy infrastructure. Recently, this token has also performed well, and I believe its target price could reach $15 to $17. Its market structure is also interesting; the token chips are fully circulating, with no risk of unlocking large amounts. Currently, its privacy ranking is 302, making it an undervalued type. I believe that as the overall privacy trend rotates in 2025, projects with solid technology but small market caps will be more easily discovered.
The third is our old favorite project, ZEN. Its market cap is also close to $200 million. It has evolved from a well-established privacy coin in 2017 into a modular privacy platform. It is currently building its Layer 3 on the BASE chain, positioning itself as a privacy-first application platform to support a series of scenarios including finance and gaming. I see three points of explosive potential. The first is a five-year, $7.4 million developer incentive program to attract developers through its protocol. The second is that mainstream exchanges have listed this token, including OKX, ASTER, etc., which have opened spot and perpetual trading, and Bitget also has trading pairs. The third point is its scalability; it is being rebuilt on BASE, combining Coinbase's compliance advantages with privacy technology. I think its story is quite appealing, transitioning from privacy to payments to applications, not just anonymous transfers, but also making privacy the infrastructure for various Web3 applications. Currently, there are about 80,000 token holders, and its trading volume and market share are also very healthy, indicating that liquidity is quite active.
In summary, these three projects each have their advantages. Railgun is essential for DeFi privacy; ZANO is an undervalued technical player; and ZEN is an old hand in platform transformation. I think these three projects belong to the category of small-cap, high-potential types, and everyone can keep an eye on them for the long term.
Host Eva:
For ordinary users, what do you think is the biggest misconception about using privacy coins? What would be your first piece of advice for new users?
Calm Brother:
Regarding the regulatory outlook for privacy coins, my judgment is that in the coming year, privacy coins will face stronger regulatory pressure and more scrutiny.
As someone who has observed the privacy coin sector for many years, I have found that the biggest misconception ordinary users have about privacy coins is confusing privacy with anonymity. This conceptual confusion has led to three serious consequences: excessive fear of regulation, misjudgment of project value, and the use of incorrect tools.
First, let me explain the difference. Privacy is about selective disclosure. For example, when you shop online, the merchant needs to know your shipping address but does not need to know your bank account balance; that is what privacy means. Anonymity, on the other hand, is about completely hiding one's identity, meaning no one knows who you are. For instance, Monero is an anonymous coin because it defaults to hiding the sender, receiver, and amount, thus lacking transparency. Zcash and the previously mentioned Railgun are privacy coins because they provide optional view keys or auditing functions, allowing you to prove their legitimacy in specific ways.
Why do I think this misconception is dangerous? Many people equate privacy with crime. They believe that using privacy coins is for money laundering or tax evasion, so they are afraid to touch them. However, in reality, privacy is your legitimate right. For example, companies need confidentiality in their acquisition strategies, and high-net-worth individuals do not want to expose their holdings to avoid attacks; these are all legitimate needs. Reports from 2025 show that the proportion of privacy coins in illegal transactions is actually far lower than that of stablecoins, yet the stigma still exists.
The second point is that many people mistakenly believe Bitcoin is anonymous. Many newcomers think Bitcoin is a dark web currency, so they believe it is very private. In fact, I think this is a completely incorrect view; all Bitcoin transactions are publicly recorded on the blockchain. As long as your address is linked to your identity, all your historical transactions can be traced. In contrast, privacy coins are the ones that truly protect your transactions from being tracked.
The third point is that many people choose the wrong tools, leading to asset losses. For example, some people buy Monero for privacy, only to find that many mainstream exchanges have delisted it, forcing them to go to smaller exchanges or OTC markets. In such cases, they may encounter scams or high slippage, or they may buy a privacy-themed coin that is merely a marketing gimmick with no real privacy protection technology. Therefore, my first piece of advice for users is to clearly define the level of your privacy needs and then choose the corresponding tools. For instance, if you just want to prevent your on-chain data from being publicly analyzed, you can use ZEC. If you are concerned about exchanges or payment platforms analyzing your transaction habits, you can choose Monero or ZANO. If you are someone who requires extreme anonymity to evade state-level surveillance, that becomes very complex.
So my practical advice is to learn before you use. Before investing large amounts of money, make sure to utilize testnets or small-scale experiences. Also, diversify your risks; do not put all your assets into privacy coins. They are highly volatile and have poor liquidity; they should be your tools rather than your investment targets. Lastly, pay attention to regulatory dynamics, including the EU's 2027 ban and relevant legislation in the U.S., so you can prepare exit strategies in advance.
In conclusion, privacy is not crime, and anonymity is not always malicious, but we must know what we are using, why we are using it, and where the risks lie. If we blindly pursue absolute anonymity, it may lead to legal and security risks. Using privacy tools reasonably is a basic right for every user in the crypto space.
Host Eva:
The last question we throw to Calm Brother is about regulation. Privacy is always a sensitive area for regulation. Do you think that in the coming year, privacy coins will face stronger regulatory pressure, or will they instead gain more users in the gray area?
Calm Brother:
Regarding regulation, this is indeed a key concern for many users. My judgment is that in the coming year, privacy coins may simultaneously face stronger regulatory pressure and experience growth in gray area users. These two trends are actually occurring in parallel, rather than being a choice between one or the other.
First, let’s discuss the escalation path of regulatory pressure. As I mentioned earlier, the EU is the most aggressive, with AML regulations that clearly state that starting from July 2027, all crypto asset service providers must prohibit anonymity. This is not a suggestion; it is mandatory, which is quite alarming. All transactions must be traceable, and transactions over €1,000 must undergo identity verification. The anti-money laundering agency in Frankfurt will regulate 40 CASPs starting in 2026, and by 2027, it will completely ban the trading of privacy coins.
In Asia, Japan and South Korea have already taken steps. Japan banned highly anonymous coins back in 2018, and South Korea fully delisted privacy coins in 2021. However, there is a key differentiation point here: Monero, due to its default privacy, is the protocol that has been most impacted, with exchanges like Binance and OKX gradually delisting it. Currently, only a few exchanges like Bybit and Bitget still have some contract trading pairs available. ZEC, on the other hand, is relatively better off because it has an optional privacy mode, providing some regulatory buffer and offering view keys for auditing purposes to meet compliance requirements. Therefore, it still has a lot of active trading on some mainstream exchanges.
So why do I say that the gray area will grow? There are actually three driving forces. The first is that regulatory personnel will increasingly demand stronger measures. This includes the EU's requirement for all cryptocurrency transactions to be fully traceable without a monetary threshold. What does this mean? It means that even the money for a cup of coffee will be recorded, leading many people to have a need for privacy protection. The explosive growth of the market cap of privacy coins this year is actually synchronized with the tightening of regulations; if you are going to regulate me, then the demand will definitely rise.
The second is that institutional demand will become more apparent. Some states in the U.S. allow limited liability companies to hold privacy coins. Why? Because businesses need privacy protection but do not require anonymity. For example, merger transactions and bulk purchases need to be transparent for specific audits, but they do not want to disclose this information to competitors. Therefore, protocols like Zcash are very suitable as they meet the compliance privacy needs.
The third is that technological breakthroughs have lowered the barriers. For instance, Zcash's ZK-SNARKS and the previously mentioned Railgun's 0ZK addresses make these privacy operations simpler, faster, and cheaper, significantly enhancing user experience. Looking ahead to the next year, I believe that by 2026, we will see more privacy coins potentially delisted from mainstream exchanges, but DEXs may still exist, and the trading volume on DEXs, including the usage of cross-chain bridges, will grow in tandem.
The gray area is not a legal vacuum; it is actually an innovative space that tests the boundaries of compliance. While regulatory pressure is certainly a given, user demand is also a necessity. Therefore, I believe the outcome of this game is that privacy coins will not disappear but will evolve into a different form.
Host Eva:
Thank you very much to Calm Brother, Crypto Circle Peter, and Moon Dojo for the in-depth observations and insights shared today—from the evolution of narratives to institutional and on-chain signals, from technology stacks to regulatory paths, everyone has clearly dissected this topic.
To summarize two key points I want to convey to the audience: 1) The current heat in the privacy sector is not due to a single reason—it is the result of the combination of "technological evolution (protocols/upgrades) + capital and narrative reshaping + regulatory path adjustments." Any significant change in any of these links will amplify the sector's volatility. 2) Advice for ordinary users and investors—treat "privacy" as a long-term and layered topic for evaluation: distinguish between improvements in foundational protocols, compliance optional privacy (such as Zcash's optional shielded mode), and pure anonymous assets (such as Monero), recognizing their different risks and opportunities, and pay attention to on-chain behavior and the movements of large holders, rather than just chasing short-term trends.
Related: CFTC Approves Cryptocurrency Spot Trading on U.S. Exchanges
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