Privacy Coins Are Hot Right Now, But Which One Will Stick Around?
In Brief
Privacy-focused crypto assets like Zcash, Monero, and COTI are gaining attention in 2025 for offering varying levels of transaction anonymity, with COTI standing out.
Privacy-focused cryptocurrencies have been among the best performing tokens this year, with the likes of Zcash and Monero making strong gains and surpassing many of their peers. Their resurgent nature suggests that privacy retains a strong appeal, and that’s hardly surprising, because anonymity of blockchain is truly a mirage.
While user’s names aren’t linked to their wallets, the reality is that every transaction is published on a public ledger that everyone can see. It doesn’t take a genius to link a wallet to a name or a face, and if that happens, your entire financial history can become public knowledge.
Privacy coins use clever cryptographic techniques to anonymize user’s transactions and safeguard this information. But each one works quite differently, and that impacts their utility and ultimately their long-term prospects.
How Do Privacy Coins Work?
Perhaps the most famous privacy coin is the original. It’s called Zcash, and it stands out for its implementation of selective transparency. In other words, users can choose if they want to transact anonymously or not.
Zcash was the first token to implement zk-SNARKS, a type of zero-knowledge proof that enables one user to prove to another that a statement is true, without revealing any data beyond the fact that it’s valid. Users can therefore send ZEC without revealing who the sender or receiver is by obscuring their wallet address. This is called a “shielded transaction”, and it also obscures the amount sent, ensuring full privacy for both users. However, users don’t have to do this, for Zcash also supports transparent transactions for businesses and individuals that require transparency. This selective transparency is a key differentiator of Zcash.
Another well-known privacy coin is Monero, which has earned something of a dubious reputation as the cryptocurrency of choice for cybercriminals. XMR transactions are private by default, using a combination of stealthy techniques.
Monero was the first cryptocurrency to employ ring signatures, which is a technique that mixes the sender’s signature with that of multiple other senders in the same block. This obfuscates their identity and makes it impossible to identify which output was sent by each signature. Ring signatures are combined with stealth addresses, where a unique, one-time public address is generated for each receiver. Only the person receiving the funds can identify this address, preventing observers from matching incoming transactions to a sender’s public address.
COTI’s innovative Garbled Circuits technique is perhaps the most sophisticated of all. It allows multiple parties to compute encrypted data over a network without revealing their outputs. NIST-grade cryptography is to keep all secure transaction data and computations. The system is designed in such a way that only the result of the computations are revealed, while inputs remain confidential. The Garbled Circuit can be likened to a locked box, which can only be accessed by an evaluator to view the correct output based on the inputs.
The approach supports more complex transactions and therefore lends itself especially well to sophisticated smart contracts and DeFi applications. In addition, COTI claims that Garbled Circuits support much faster transactions than methods such as zk-proofs and ring signatures, which require complex cryptographic operations.
What Are They Used For?
As the first major privacy coin, Zcash’s utility is somewhat limited to a few basic scenarios, such as payments. ZEC is a useful coin for individuals and businesses wanting to transact confidentially, or for those who have reason to believe their finances might be under surveillance. The token has become a popular way for users to donate money to charity and other organizations in an anonymous way, but its lack of smart contract functionality curtails its use in more advanced protocols, such as DeFi applications.
Monero prides itself on its reputation of “uncensorable money”, supporting truly private peer-to-peer transactions, but its robust cryptography has also made it a popular choice for less ethical individuals. XMR has become the favorite cryptocurrency for cybercriminals that spread “ransomware” in order to hold businesses hostage, due to its untraceable nature. For the same reason, it’s widely used on “dark web” marketplaces, allowing users to buy and sell illegal goods and services online without risk of being traced.
On the other hand, COTI’s implementation of Garbled Circuits gives it broad utility, especially in DeFi applications. The technique can be used to execute transactions of extreme complexity, including cross-chain token swaps. It’s able to support confidential smart contract interactions for use cases including private decentralized autonomous organizations, real-world assets, stablecoins and confidential, federated learning for blockchain-based AI applications. COTI is regarded as the very definition of programmable privacy, because it can also support independent audits, making it regulatory compliant for institutions.
Which Is The Hottest Prospect?
Assessing the long-term prospects for any token, let alone privacy tokens specifically, is a tough business, and much will depend on the evolving regulatory environment around crypto and the privacy needs of businesses and institutions.
Privacy coins in general have performed well this year, but Zcash stands out, with its value fivefold to $259 per coin at the time of writing (Oct 2025). A lot of this is organic growth driven by an enthusiastic community, and that, combined with its longevity, suggests it’s a token that will stick around. With its optional privacy controls, ZEC does provide a more palatable solution for users who want to transact secretly while remaining accountable.
Monero is likely to stick around too, because it will not easily lose its status as the number one privacy option for those who want uncompromised secrecy above all else. Despite its reputation, it also has a strong community behind it, which ensures a relatively strong trading volume. Moreover, 2025 has been a good year for XMR, with its value gaining 95% in the year to date. However, the negative perception of Monero as a vehicle for illicit transactions likely makes it too unpalatable for institutional adoption.
That brings us to COTI, which stands in stark contrast to Monero. COTI’s value has actually declined somewhat this year, but its programmable privacy nonetheless makes it a very institutionally-friendly token, enabling businesses to transact secretly while remaining compliant. COTI’s rapid transaction speed, especially compared to Zcash, also stands it in good stead, while its unmatched utility has enormous potential for private and secure DeFi operations.
Final Thoughts
For now, Zcash and Monero remain the best-known privacy tokens, ranked as the 28th and 22nd most valuable cryptocurrencies of all, according to Coinmarketcap. However, the limited usefulness of these tokens may be a hindrance to their long term growth prospects.
COTI’s success will ultimately depend on how well it’s able to establish itself in the wider financial world, and it does have some traction here, partnering with Fidelity, Stellar and Coinbase in the Tokenized Asset Coalition, for example. It’s also said to be working with Israel’s central bank on a prototype digital shekel, which is another strong validation of its technology.
We can’t rule out Zcash and Monero, which have strong momentum, but as crypto matures and struggles to balance transparency with privacy, more sophisticated coins like COTI may be just what organizations need to navigate this complexity.
Disclaimer
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About The Author
Alisa, a dedicated journalist at the MPost, specializes in cryptocurrency, zero-knowledge proofs, investments, and the expansive realm of Web3. With a keen eye for emerging trends and technologies, she delivers comprehensive coverage to inform and engage readers in the ever-evolving landscape of digital finance.
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Alisa, a dedicated journalist at the MPost, specializes in cryptocurrency, zero-knowledge proofs, investments, and the expansive realm of Web3. With a keen eye for emerging trends and technologies, she delivers comprehensive coverage to inform and engage readers in the ever-evolving landscape of digital finance.
