Bybit x Santiment Crypto Insights Report: Why crypto will always have a place for privacy and why it rises again

Even though most blockchains are designed to be transparent, privacy remains one of crypto’s oldest and strongest ideals. Traditional cryptocurrencies like Bitcoin, Ether and over 99% of other tokens record each of their transactions in a public ledger that anyone can trace, meaning that anyone with the right tools can analyze your spending habits, income sources or wallet connections. Privacy tokens, on the other hand, protect sensitive information, such as the sender, receiver and amount of each transaction. Out of over 25,000 active crypto tokens tracked across exchanges and aggregators, fewer than 200 (≈0.8%) implement any form of privacy-by-design.

Often, the idea of these types of digital assets can cause some to associate these tokens with potential criminal activity. After all, why else would you need complete anonymity?. Nevertheless, for many users, the privacy sector doesn’t exist for the purpose of hiding from the law. Much of the pro-privacy coin community sees the sector’s existence as a way to truly restore the financial confidentiality that existed with cash. It certainly doesn’t hurt that prices have been soaring for the sector here in October.

7-day price returns of top market cap privacy coins. Source: Santiment

Anonymity is a concept that’s aligned with the decentralized nature of cryptocurrency’s original objective. Just as people wouldn’t want their bank statements publicized, many crypto users don’t want their wallet activity exposed. Gray-area moral arguments aside, privacy tokens emerged back in early 2014 (with the release of Bytecoin and Monero) to give individuals the choice to transact freely without constant oversight. In doing so, the 11-year-old sector preserves a part of crypto’s original vision — financial freedom that isn’t conditional based on government or corporate approval.