Privacy tokens have been in the spotlight this week, countering the downturn impacting the broader crypto market.
Prominent commentators in the cryptocurrency space have been predicting a sharp rise in the price of privacy coins for months. Their predictions now appear to be coming true.
Some wonder if there wasn’t a concerted effort to drive up the price of privacy coins. Alex Bornstein, executive director of the Zcash Foundation, told Cointelegraph that Zcash’s recent success is due to widespread concerns about governments violating users’ privacy rights.
A combination of hype and technology has brought privacy coins back to prominence while other coins have struggled.
Zcash
Privacy coin Zcash (ZEC) has posted impressive gains, with its market capitalization rising more than 10% in the last week. Zcash price has increased over 76% in the past 7 days to $632. This makes Monero (XMR) the largest privacy coin by market capitalization.
The price increase follows a major upgrade by the network’s developer, Electric Coin Company. At the beginning of the month, the company introduced cross-chain swaps and private payments by integrating with its transaction layer, Near Intents.
This integration has resulted in a surge in near intent Zcash volumes and expanded the “shielded pool”, or collection of encrypted addresses where ZEC is stored.
“I think people are just starting to wake up to what Zcash can really accomplish, just because of the strong narrative,” Bornstein told Cointelegraph about Chain Reaction.
Related: Why Zcash and privacy tokens are trending again
Monero
Monero (XMR), until recently the largest privacy coin on the market, has increased in price by nearly 10% over the past week. Market capitalization increased by 2.7% to $6.62 billion.
On October 8th, the Monero blockchain introduced the Fluorine Fermi update to the network. This is intended to increase user security against “spy nodes”.
In Monero terminology, a spy node refers to a malicious node, group of nodes or botnet that can calculate and match transactions to addresses on the Monero network.
Related: Monero releases Fluorine Fermi update to fight spy nodes
The Monero community has been fighting to keep the blockchain private as privacy coins become increasingly difficult to use due to exchange delisting, regulation, and the aforementioned spy nodes.
We have also established safety protocols. In late 2024, Monero Research Lab proposed allowing node operators to create a banned list of suspected spying nodes based on their IP addresses.
dash
Privacy Coin Dash (DASH) price rose more than 130% over the week, ending seven days of trading at just above $107.
On November 2nd, decentralized exchange Aster DEX launched Dash perpetual futures trading with 5x leverage. Listing on a new exchange has increased the liquidity and visibility of the token. Analysts note that part of the price increase can be attributed to the current saga surrounding privacy coins.
ZKsync
The price of privacy coin ZKsync (ZK) has increased by 113% and is trading at $0.063 at the end of the week.
ZKsync, an Ethereum layer 2 that uses zero knowledge (ZK) rollups to process transactions off-chain, could soon see major changes to its governance token.
On Tuesday, ZKsync co-creator Alex Gluchowski said the network has evolved significantly since the project’s inception and now hosts several interconnected zero-knowledge chains.
Related: ZKsync creator floats governance token revamp to add “economic utility”
“The goal is to align use and value, make decentralization economically sustainable, and secure a meaningful share of the economic benefits the network generates,” he said.
To achieve this, Glukowski proposed changes to tokenomics, saying value would need to be derived from fees generated from “interoperability and other core payments and messaging functionality” on-chain, and through licensing agreements for “enterprise software components” off-chain.
He also suggested licensing agreements for large enterprises to deploy networks. “If such capabilities are funded by the ecosystem, it makes sense that their use by corporate participants would bring value to the ecosystem.”
Decredo
The price of Decredo (DCR) has also fallen sharply this week. The token soared on Monday and then subsided, ending the week up 90% to $30.
Decred’s price has been in a relatively narrow range for most of the past two years. The recent price spike suggested a narrative-driven rally as the prices of other privacy tokens rose.
On November 3, CoinMarketCap recognized Decred as a privacy coin, drawing attention to its staking and governance structure. The network uses a hybrid proof-of-work (PoW) and proof-of-stake (PoS) mining system to “ensure that small groups cannot dominate transaction flows or make changes to Decred without community input.”
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