TL;DR
- The crypto market has lost more than $1 trillion, while Zcash drove privacy coins higher with a rally that pushed its market cap above $7 billion.
- Zcash overtook Monero after a surge that coincided with Bitcoin’s 30% drop and with a spike in retail activity that turned ZEC into one of the most searched assets on Coinbase.
- Regulatory pressure, European delistings, and the Tornado Cash and Samourai Wallet cases reduced liquidity and amplified volatility across the sector.
The crypto market has shed more than $1 trillion in six weeks, but the privacy coin segment moved in the opposite direction.
Zcash led that trend with a rally that multiplied its price several times since August and pushed its market capitalization above $7 billion. This jump occurred while Bitcoin fell nearly 30% from its $126,000 peak, dragging the rest of the market into a deep correction.
Why Did Privacy Coins Rise?
The rally unfolded in a small and extremely volatile corner of the market. The combined value of privacy coins sits between $30 billion and $35 billion, barely 1% of total crypto capitalization. That limited scale explains the sharp swings that appear when marginal demand enters the market or when short positions get caught in fragmented liquidity. Zcash itself overtook Monero as the largest privacy coin by market cap, also boosted by a strong rise in retail activity. On Coinbase, ZEC became one of the most searched assets of the month.
The regulatory backdrop was a decisive factor. Global pressure has intensified since the FATF adopted full AML standards for digital assets in 2019. Its most recent review shows that nearly 75% of jurisdictions remain only partially aligned, prompting new rounds of regulatory tightening. In Europe, AML Regulation 2024/1624 will remove privacy coins from regulated platforms by 2027 and require crypto providers to apply bank-style AML controls. Holding these assets will not be banned, but regulated infrastructure will be redesigned to exclude them.
The Enforcement Pressure on Platforms and Developers
Exchanges responded with a wave of delistings that further reduced liquidity. Binance restricted ZEC, XMR, and DASH in several European jurisdictions, while Kraken removed Monero in the EEA at the end of 2024. That shrinking availability shifted trading to thinner venues and increased price sensitivity to large orders or speculative flows.
Sanctions and enforcement actions also added heavy pressure. The Tornado Cash case left an ambiguous precedent that still lingers, and the criminal proceedings against Samourai Wallet’s founders reinforced the sense of legal risk among compliance teams
