Privacy coin market is surging – Vitalik Buterin hints at concerns over European regulations

Regulatory Tightness Moves the Market

In 2025, while Bitcoin is relatively stagnant, the privacy coin market is experiencing an unexpected surge. Behind this phenomenon is strong industry opposition to overly restrictive regulations such as the European Digital Services Act (DSA) and MiCA.

Ethereum co-founder Vitalik Buterin recently questioned the EU policies on the X platform. He pointed out the danger that DSA creates a digital environment that “completely eliminates room for different perspectives and experimental products.” He argues that the core issue is not the existence of unpopular ideas but the algorithms that indiscriminately spread them. Eliminating such ideas risks normalizing surveillance and control.

Turning Point Indicated by Market Data

Artemis data confirms that the privacy coin sector is among the top performers in 2025. During the same period, major Bitcoin (BTC) gains are relatively restrained, while Zcash (ZEC) has soared over 700%, showing a +9.50% increase over 24 hours.

Monero (XMR) also maintains strong performance, demonstrating resilience against downward pressure. Both trading volume and market capitalization rankings for privacy coins are rising significantly. This movement suggests capital inflows into assets that preserve holder freedom.

Interaction Between Ethereum Ecosystem and Regulatory Environment

Large blockchain platforms like Ethereum are also facing the wave of European regulations. With the official implementation of MiCA, crypto asset companies are required to obtain licenses, establish user disclosure standards, and reconsider offered tokens. Scrutiny of stablecoins has intensified, and exchanges are instructed to phase out non-compliant products.

At the same time, new cybersecurity rules and operational risk management standards are being enforced, with anti-money laundering agencies prioritizing crypto assets for monitoring. Under these new sanctions schemes and strict oversight, Europe’s crypto market is now under tight regulatory control.

Learning Patterns from Precedents

US sanctions against Tornado Cash marked a turning point in the debate over privacy technology. Subsequently, exchanges increased compliance burdens, and privacy coins like Monero have been excluded from many trading pairs, including Ethereum-based transactions.

Japan effectively banned privacy coins several years ago, and other regions have strengthened restrictive measures. When access is limited, demand and interest shift elsewhere. Recent judicial rulings related to Tornado Cash continue to keep privacy coins in focus.

Market Moves Against Regulations

Here lies a key point. While Europe tightens regulations, privacy coins are once again attracting market interest. The policy warning by Buterin about “eliminating controversial options” aligns precisely with this cycle.

The more a system restricts certain features or tools, the more users will seek those features. This is not just market principle but an inevitable result of regulatory rigidity.

Key Points

• Market Leaders: Privacy coins are showing the best performance within the crypto sector in 2025, with Zcash soaring over 700% and Monero remaining strong
• Regulatory Environment: The enforcement of MiCA and DSA accelerates capital inflows into privacy-focused crypto assets
• Industry Perspective: Major stakeholders, including Vitalik Buterin, suggest that stricter regulations may paradoxically increase demand for privacy coins
• For Market Participants: Monitoring major currencies such as Ethereum prices (including CAD-denominated) and tracking future movements of privacy coin markets are becoming increasingly important