Buying ZEC to Crash BTC? Four Industry Truths Behind the Privacy Coin Surge

Chainfeeds Guide:

The retro resurgence of privacy coins: a new trend in crypto or just a synonym for offloading?

Source:

Author:

Odaily

Opinion:

Odaily: The emergence and development of privacy coins has not happened overnight. As early as 2014, DASH became known as a "privacy token," and before that, Bytecoin had already paved the way for the sector by implementing anonymous transactions using the CryptoNote protocol and ring signatures technology. In 2016, the launch of ZEC introduced an "optional privacy" mechanism based on zk-SNARKs, allowing users to freely choose between transparent and shielded transactions. That same year, XMR forked from Bytecoin, providing default privacy protection through the RingCT protocol and quickly gaining market favor. After 2019, privacy coins faced a winter due to regulatory pressures and delistings from exchanges, but new projects still broke through, such as ZEN, which introduced the concept of sidechain privacy, and ARRR, which implemented a mandatory privacy mechanism. Overall, privacy coins are one of the sectors most aligned with the spirit of decentralization after BTC. The recent surge in the sector, aside from Naval’s high-profile endorsement of ZEC, was further fueled by the U.S. government’s seizure of 127,271 BTC (about $15 billion), which reignited market attention on anonymity and self-sovereignty, directly triggering the privacy coin revival. The latest popularity of privacy coins is inseparable from the resonance of celebrities and institutions. ZEC’s surge began when Silicon Valley investor Naval retweeted a statement by Helius founder mert on October 1: "Bitcoin is insurance against fiat, Zcash is insurance against Bitcoin." At that time, ZEC was only $68. On the 20th, Naval spoke again, emphasizing that Zcash’s "transparent option" design is the main reason it can remain listed on exchanges for the long term, and pointed out that as decentralized exchanges rise, this concern will be diminished. These remarks ignited market sentiment, and privacy coins collectively soared. In addition, Grayscale holds over $100 million in ZEC trust assets, and trading activity on platforms such as Coinbase has brought renewed liquidity and institutional endorsement to the privacy coin sector. On the technical side, ZEC developer Electric Coin Co. released its roadmap for Q4 2025, planning to enhance the privacy experience by optimizing the Zashi wallet, introducing the NEAR Intents protocol, and adding P2SH multi-signature functionality. The total amount of Zcash’s privacy pool tokens has surpassed 4.92 million, accounting for 30% of the circulating supply, indicating a significant increase in real usage. Although privacy coins have seen a short-term boom, their value logic remains controversial. Some industry insiders point out that tokens like ZEC, XMR, and ZEN still mainly serve as "anonymous exchange assets" in the market—when some holders wish to anonymously cash out BTC, they do so via privacy coin intermediary trades. Thus, in every bull market, privacy coins are "rebranded" as offloading tools rather than genuine technological revolutions. Some comments even note that certain so-called "privacy coins" have long removed their privacy features and now exist only as ordinary tokens on the Base chain. This shows that while the privacy concept carries an aura of idealism, it often becomes just a narrative cloak for market speculation. Privacy is not a panacea, and hype is more like a quick fix—it can temporarily boost prices but cannot build lasting value. Between ideals and reality, privacy projects that can truly endure cycles must return to technological innovation and sustainable ecosystem development.