In the past two years, privacy has been a somewhat awkward topic in the crypto world. On one side is the blockchain's emphasis on transparency and openness, while on the other side, market demand for privacy has never subsided—financial privacy, commercial sensitivity, security protection—these needs have never truly disappeared.

By 2025, the trend has shifted. Institutions are beginning to participate seriously, regulatory frameworks are gradually becoming clearer, and cryptographic tools like zero-knowledge proofs are becoming more mature. The previous adversarial anonymity solutions are evolving into truly composable, compliant, and more systematic infrastructure. Privacy is no longer a niche form of resistance but an underlying requirement that cannot be avoided in encrypted finance.

Looking at the market data, the most direct indicator. Since the second half of 2025, privacy assets have outperformed the broader market. Traditional privacy coins like Zcash and Monero have shown significant gains, with Zcash's highest increase approaching 1100% this year, once surpassing Monero's market cap. This is not speculation or hype but a market re-pricing the long-term value of privacy infrastructure—especially those solutions that combine privacy features with compliance flexibility.

Deeper technological iterations are underway. Early privacy projects mainly focused on hiding transaction paths to anonymize transfers—Monero, early Zcash, Tornado Cash—all followed this approach. This was the Privacy 1.0 stage, where the core idea was to separate on-chain identities. Now, new projects are taking a completely different approach—