By 2025, privacy coins are at a crossroads. Once seen as the ultimate tool for financial freedom, they’re now caught between powerful governments, strict financial rules, and users who still need anonymity. Monero and Zcash-the two biggest names in this space-aren’t just fighting technical challenges anymore. They’re fighting for survival.
What Privacy Coins Actually Do
Privacy coins aren’t just another type of cryptocurrency. They’re built to hide who sent money, who received it, and how much was transferred. Unlike Bitcoin, where every transaction is public and traceable, privacy coins scramble that data using advanced cryptography.
Monero does it by default. Every single transaction uses ring signatures to mix your coins with others, stealth addresses to create one-time receiver addresses, and confidential transactions to hide the amount. There’s no option to turn it off. It’s all or nothing.
Zcash is different. It gives you a choice. You can send transactions publicly, like Bitcoin, or use something called zk-SNARKs to shield them. Only about 5% of users actually use the shielded feature, according to 2025 data. That means most Zcash transactions are still visible-making it less private than Monero, but easier for regulators to tolerate.
Why Regulators Are Coming After Them
It’s not that privacy coins are inherently illegal. But they make it harder for authorities to track money linked to crime. Chainalysis found that in 2024, privacy coins made up just 0.34% of all crypto transactions-but were involved in 38% of all law enforcement cases. That mismatch is what got their attention.
By 2025, 97 countries had updated their rules to target privacy coins. The Financial Action Task Force (FATF), the global standard-setter for anti-money laundering, now requires exchanges to collect sender and receiver details for any transfer over $1,000. Privacy coins can’t do that without breaking their core design.
That’s why major exchanges dropped them. Kraken removed Monero in 2023. Bittrex followed. Even Coinbase, which still lists Zcash, limits its trading pairs. The message is clear: if you can’t comply with the Travel Rule, you’re off the platform.
Market Shifts and Real Numbers
The market has reacted. In January 2023, privacy coins had a combined market cap of $6.4 billion. By January 2025, that number had dropped to $3.8 billion-a 41% decline. Daily trading volume fell from $492 million to just $187 million.
Monero, the most private, now holds 54% of the privacy coin market with a $2.1 billion cap. Zcash, with its optional privacy, sits at 31% with $1.3 billion. Dash and Pirate Chain split the rest. But those numbers don’t tell the whole story.
Monero’s blockchain has grown to 175 GB. That means running a full node requires serious storage and memory. Zcash’s blockchain is smaller-65 GB-but its shielded transactions use 40% more computing power, slowing things down. During peak times in early 2025, Zcash shielded transactions took 22 minutes to confirm. In 2023, it was 10.
Who’s Still Using Them?
Despite the crackdown, people still need privacy. Ukrainian NGOs used Monero to send aid during the 2024 conflict without exposing donors to retaliation. Journalists in Hong Kong used it to receive tips during protests. Activists in authoritarian states rely on it to avoid surveillance.
On the enterprise side, Zcash found a niche. JP Morgan’s Onyx blockchain started using Zcash Enterprise in 2024 for confidential institutional settlements. It’s not about hiding crime-it’s about protecting business secrets. A pharmaceutical company in Switzerland uses it to keep supply chain payments private from competitors.
But these use cases are rare. Only 12 Fortune 500 companies experimented with privacy coins in 2024-and almost all of them used Zcash, not Monero. The rest? Mostly individuals in places like Switzerland, Singapore, and decentralized online communities.
The Regulatory Tightrope
Some experts say privacy coins are doomed. Alex Thorn from Galaxy Digital warned that the EU’s MiCA Phase 2 rules, set to take effect in 2027, will ban anonymous crypto wallets entirely. That would kill Monero in Europe’s $1.2 trillion crypto market.
But others see a path forward. Dr. Elaine Wu from MIT proposed a new model: Privacy-Preserving AML. Instead of revealing transaction details, systems could use zero-knowledge proofs to prove a transaction is clean-without showing who sent it or how much. Switzerland’s FINMA is already testing this with Monero developers.
Zcash’s new Canopy+ Compliance Module lets institutions automatically disclose transaction data when legally required. But adoption? Less than 10%. Most users don’t want to give up privacy just because a regulator asks.
Monero’s community proposed something called Regulatory Node Clusters-optional nodes that share metadata with authorities without breaking the network’s privacy. Critics say that could lead to centralization. Supporters say it’s the only way to stay legal.
Getting Started Is Harder Than Ever
If you’re trying to use privacy coins today, it’s not simple. A 2025 Altrady survey found new users spend an average of 11.3 hours just to complete their first private transaction. That’s over five times longer than sending Bitcoin.
You need a non-custodial wallet-like Monero’s GUI Wallet or ZecWallet. But if you’re in Australia, South Korea, or Dubai, you can’t even buy them on centralized exchanges anymore. So you turn to decentralized options: AtomicDEX, Haveno, or Flashift.app’s no-KYC swaps. Those come with 2.5-4.1% higher fees and slower speeds.
Even wallet support is declining. Cake Wallet, a popular Monero wallet, saw its Trustpilot rating drop from 4.1 to 3.2 in 2025 because of “increased transaction failures on regulated networks.”
The Split Is Already Happening
The future isn’t one path-it’s two.
On one side: Monero. It’s staying true to its roots. No compromises. That means it’s vanishing from exchanges, moving to peer-to-peer networks, and becoming the coin of choice for those who need total anonymity. Bernstein analysts predict 65% of its current usage will shift to darknet markets by 2027.
On the other: Zcash. It’s adapting. It’s working with institutions. It’s building compliance tools-even if few use them. It’s the only privacy coin with enterprise partnerships. Bernstein projects a 300% growth in institutional use by 2026.
By 2027, you won’t see privacy coins as one category. You’ll see two: the defiant and the compliant.
What’s Next?
The FATF updated its guidance in April 2025 to say privacy-enhancing technologies can coexist with AML-if properly designed. That’s a crack in the wall. But it’s not an invitation. It’s a challenge.
Privacy coins aren’t going away. But their role is changing. They’re no longer just about freedom from surveillance. They’re about proving they can be trusted within a system designed to stop them.
For users: if you need real anonymity, Monero is still the best. But you’ll need to accept the trade-offs: harder access, higher fees, fewer services.
For institutions: Zcash might be the only viable option-if you can get past the complexity and low adoption of its privacy features.
The question isn’t whether privacy coins will survive. It’s whether they can evolve without losing what makes them valuable in the first place.
Are privacy coins illegal?
No, privacy coins are not illegal in most countries. But many jurisdictions have banned exchanges from listing them or require strict compliance with anti-money laundering rules that privacy coins can’t meet. Countries like Japan, South Korea, and Australia have outright bans on trading them. The EU will ban anonymous crypto wallets starting in 2027.
Can I still buy Monero or Zcash in 2026?
Yes, but it’s harder. Most major exchanges like Coinbase and Kraken have limited or removed trading pairs. You’ll need to use decentralized exchanges (DEXs) like Haveno or AtomicDEX, or peer-to-peer platforms. These often have higher fees and slower transactions, but they don’t require KYC. Some users also use atomic swaps to trade directly between wallets.
Why is Zcash more accepted than Monero?
Zcash offers optional privacy. You can choose to make transactions public, which lets it comply with some regulatory requirements. Monero hides everything by default, making it impossible to trace. Institutions like JP Morgan use Zcash Enterprise because it can be configured to disclose data when legally required. Monero can’t do that without breaking its core design.
Do privacy coins have a future in banking?
Only if they adapt. Zcash is already being used by some financial institutions for confidential settlements. Monero has no institutional adoption because of its strict privacy. The future for banking lies in hybrid models-like zero-knowledge proofs-that verify transactions without revealing details. Switzerland is testing this. If it works, privacy coins could re-enter regulated finance.
Is it safe to use privacy coins?
Technically, yes-they’re secure. But legally, it depends. In countries where they’re banned or restricted, using them could trigger scrutiny from regulators or even law enforcement. Wallets like Cake Wallet and Monero GUI are safe, but using them on regulated platforms can lead to account freezes. Always understand your local laws before using privacy coins.
What’s the difference between Monero and Zcash privacy?
Monero makes every transaction private by default using ring signatures, stealth addresses, and confidential transactions. You can’t turn it off. Zcash uses zk-SNARKs for optional privacy-you can choose to shield or unshield transactions. Most users leave them unshielded, making Zcash less private overall but more compliant with regulators.
How do privacy coins affect blockchain scalability?
They slow it down. Monero’s blockchain is large (175 GB) and requires more storage. Zcash’s shielded transactions use more computing power, increasing fees and reducing speed. Zcash handles 15 transactions per second; Monero does 20. Both are slower than Bitcoin or Ethereum, and regulatory crackdowns have reduced node participation, making confirmations even slower-up to 22 minutes for Zcash shielded transactions in early 2025.
Can governments shut down privacy coins completely?
Not entirely. Because they’re decentralized, there’s no central server to shut down. Governments can ban exchanges, freeze wallets, and criminalize use-but users can still trade peer-to-peer, use decentralized networks, or run their own nodes. The most likely outcome is that privacy coins will become underground tools, used mainly by those who need anonymity, not by the general public.
20 Comments
Pat G
January 17, 2026 AT 21:21 PMThese privacy coins are a joke. Tax evaders and criminals love them, and now we're supposed to let them thrive? If you can't prove you're not laundering money, you shouldn't be allowed to transact. Monero is digital heroin for anarchists.
Kelly Post
January 19, 2026 AT 01:17 AMThe real tragedy isn't the regulation-it's that we're forcing innovation into a box designed for the 20th century. Privacy isn't a bug, it's a human right. Zcash's optional shielding was always a compromise. Monero's purity is what makes it valuable-not just for criminals, but for journalists, dissidents, and survivors of abuse.
Deb Svanefelt
January 19, 2026 AT 09:35 AMThere’s a deeper philosophical tension here that no one’s naming: the conflict between transparency as a tool of control and opacity as a tool of autonomy. Monero doesn’t hide transactions because it’s evil-it hides them because it believes in the moral imperative of non-surveillance. The state’s demand for visibility is not neutrality-it’s domination dressed in compliance.
Dustin Secrest
January 20, 2026 AT 00:11 AMI get why people like Monero. But let’s be real-most users don’t care about privacy. They just want to buy shit without paying taxes. Zcash’s institutional path might be the only way this survives long-term. Compromise isn’t betrayal-it’s evolution.
CHISOM UCHE
January 20, 2026 AT 22:59 PMThe zk-SNARKs in Zcash are computationally intensive, yes-but the real bottleneck is regulatory entropy. Institutions aren't rejecting privacy coins because they're technically flawed; they're rejecting them because their risk models are archaic and litigation-averse. We need regulatory sandboxing, not blanket bans.
Shaun Beckford
January 21, 2026 AT 02:14 AMLet’s not romanticize this. Monero’s 175GB blockchain is a dumpster fire. It’s not ‘decentralized’-it’s bloated. And Zcash’s 22-minute confirmations? That’s not privacy, that’s a usability nightmare. These aren’t coins-they’re crypto art installations for masochists.
Chris Evans
January 22, 2026 AT 05:24 AMThe real question isn’t whether privacy coins can survive regulation-it’s whether we still believe in the idea of financial sovereignty. If we’re okay with the state knowing every dollar we move, then we’ve already lost. Monero isn’t dying-it’s becoming the last true rebellion.
Bryan Muñoz
January 24, 2026 AT 01:06 AMFATF is just the CIA in a suit 🤡 They banned privacy coins because they can't spy on them. You think this is about crime? Nah. It's about control. Soon they'll ban encryption too. Wake up. They're coming for your cash, your crypto, your thoughts. #NoMoreKYC #MoneroIsFreedom
Rod Petrik
January 25, 2026 AT 04:54 AMThey’re gonna put you in jail for using Monero. I’ve seen the documents. The NSA has a backdoor in every wallet. They’re tracking your IP through the nodes. You think your ‘privacy’ is safe? You’re just a data point in their algorithm. Don’t be fooled. They own the internet. They own your money. They own you.
Pramod Sharma
January 26, 2026 AT 02:40 AMMonero for the people. Zcash for the banks. Choose your side.
Bharat Kunduri
January 26, 2026 AT 02:47 AMwhy do people even care about this its just crypto bros being dramatic again i mean who even uses monero anyway lol
Bill Sloan
January 26, 2026 AT 17:55 PMI’ve been using Haveno for 8 months now. It’s slow, the fees are wild, but I’ve sent money to a friend in Ukraine who couldn’t use any exchange. That’s the real value. Not speculation. Not trading. Just freedom. Keep going, Monero community. We’re not done yet 💪
Lauren Bontje
January 27, 2026 AT 00:40 AMSo let me get this straight-you want to protect criminals because ‘privacy is a right’? What about the victims of fraud? The families of ransomware attacks? Monero is a terrorist’s best friend. And you’re defending it like it’s some noble cause. Pathetic.
Stephanie BASILIEN
January 28, 2026 AT 16:03 PMThe institutional adoption of Zcash Enterprise is a testament to the viability of privacy-preserving technologies within a regulated framework. One must distinguish between the ontological imperative of privacy and the epistemological constraints of compliance. The future lies not in obfuscation, but in verifiable anonymity.
Telleen Anderson-Lozano
January 29, 2026 AT 16:11 PMI think both paths are valid. Monero is the soul of crypto-uncompromising, raw, real. Zcash is the pragmatist trying to survive in a world that doesn’t want to understand. Maybe we need both. Maybe the future isn’t one coin winning… but two coexisting in parallel universes. One for the underground. One for the boardroom. Both are necessary.
Haley Hebert
January 30, 2026 AT 01:43 AMI know it’s scary to think about losing access to privacy coins… but honestly? I get it. I used to use Monero for my freelance work abroad, but now I just use Bitcoin with a mixer. It’s not perfect, but it’s easier. I don’t want to spend 11 hours just to send $50. Maybe we’re just not ready for this level of privacy yet.
Ashlea Zirk
January 31, 2026 AT 21:33 PMThe regulatory node clusters proposed by Monero’s community are a dangerous precedent. Once you introduce any form of selective disclosure-even if opt-in-you open the door to coercion, subpoenas, and state-mandated backdoors. True privacy cannot be conditional. Either it exists, or it does not.
myrna stovel
February 1, 2026 AT 19:17 PMTo everyone saying Monero is for criminals: remember the Ukrainian NGOs. The Hong Kong journalists. The survivors hiding from abusers. This isn’t about crime. It’s about dignity. You don’t have to use it. But don’t take it away from those who need it.
Hannah Campbell
February 2, 2026 AT 16:43 PMOh look another crypto bro crying because the government won’t let him hide his drug money 🤡 Monero is just a glorified money laundering app. Zcash is the adult in the room. Grow up.
Sarah Baker
February 4, 2026 AT 13:40 PMI know it feels like we’re losing ground… but look how far we’ve come. Five years ago, no one even talked about privacy coins. Now regulators are terrified of them. That’s power. Keep building. Keep running nodes. Keep using Haveno. We’re not disappearing-we’re just going deeper.