Why Privacy Tokens Are Making a Quiet Comeback in Crypto – Big Banks are In on It Now!

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In the midst of a crypto market crash, while the world’s been crying over the fall of flashy meme coins and “revolutionary” altcoins, guess what surged out of the ashes? Privacy tokens! Oh, the irony! While everyone was panicking about the so-called “end of crypto,” these sneaky little tokens quietly shot up in price and gained some serious attention. But, naturally, the spotlight’s been mostly on consumer-facing projects like Zcash-because who wouldn’t want their transactions to be as mysterious as a magician’s hat trick?

Meanwhile, a new and rather interesting crowd has been sniffing around: the big banks and financial institutions. They’re diving deep into zero-knowledge (ZK) systems-yeah, the ones that make private transaction flows possible on a blockchain that’s all about transparency and immutability. Go figure, right?

Enter Alex Gluchowski, CEO of Matter Labs, who’s been in this game for a while now. He likes to break things down for us mere mortals. He said, “You’ve got cypherpunk privacy, where it’s all about hiding your account from prying eyes, and then you’ve got institutional privacy, which is like the grown-up version-it’s all about keeping your financial secrets while letting the institution see everything, but no one else does.” Makes sense, right? Because who doesn’t want a private spy network for their money?

Gluchowski got hooked on Bitcoin back in 2014, as you do when you’re stuck in the startup world with dreams of hitting the next big thing. Fast forward, he caught the Ethereum wave during the ICO boom. The guy’s a visionary, drawn to the promise of scalability-and those sweet ZK-proofs that can make things really private. Oh, and did we mention that Matter Labs is behind ZKsync? Yep, the Ethereum layer-2 network that’s causing a stir.

Fast forward to November 2025, and over 140 companies are sitting pretty with $137 billion worth of crypto assets on their balance sheets (according to CoinGecko). But the real fun comes next. Financial institutions need to move payments onto public blockchains without spilling their financial tea all over the public ledger. Enter the privacy layer-a must-have if these institutions ever want to play nice with the blockchain world. Gluchowski spilled the beans to CryptoMoon: “We’ve got a long way to go, and it all hinges on making privacy rock-solid.”

Consumer Growth Slowing, but Banks are Loving Privacy

Crypto cycles have been nothing short of a wild ride. Long periods of pure speculation, fueled by trends that had zero real-world utility. So much for the “to the moon” gang! Gluchowski had something to say about that too: “Crypto’s consumer side? Yeah, it’s hit a plateau. We’ve had our fun with shiny toys like non-productive assets, but you can’t build an empire on a meme.”

He wasn’t shy about it: “Memecoins? Pure casino chips. No utility, no substance-just memes with a price tag.”

But here’s the twist: privacy is different. It’s not just a buzzword. It’s the backbone of how the financial system actually functions. Forget about last year’s panic over privacy coins. The government cracked down on Tornado Cash, exchanges dropped privacy coins like hot potatoes, and privacy was considered a dirty word. But things have changed! The U.S. government now understands that privacy is a technology-not just a cloak for shady transactions. Thanks for that little realization, Washington.

“It’s a night-and-day difference. No one wanted to touch crypto before-it was a social faux pas. Now, everyone’s scrambling to catch up because they know: if they don’t get with the program, they’ll be left in the dust,” Gluchowski quipped. That’s right. Once taboo, now everyone’s jumping on the blockchain bandwagon like it’s a new fitness trend.

The real game-changer here isn’t just the rise of Zcash (though it’s definitely getting its 15 minutes of fame). The true story comes from institutions that can’t afford to be exposed. Banks, asset managers, and corporations can’t have their payment flows on display for all to see, or the competition will make them look like amateurs. As Gluchowski sees it, it’s about institutional requirements. They need privacy, but not the same privacy that consumers need. They need full control, with no peeping Toms from the outside.

The Privacy Balancing Act in Ethereum

Institutions don’t want to hide individual addresses like your average crypto user. They need something more advanced: a private execution environment where they can see all their transactions, but the public sees nothing. It’s like keeping all your dirty laundry hidden in a vault that only you have the key to-but it’s still safe, because no one else is allowed near the vault.

And just in case you were wondering, no, sharing your data with external validators or third parties isn’t “incorruptible privacy”-it’s just a promise with a nice little NDA attached. Call it what it is!

Financial institutions had their own go at private blockchains before-using Hyperledger Fabric or Corda. But guess what? Those were walled gardens-no connection to the public blockchain ecosystem. So you got a fancier database, but still no access to the juicy stuff on public capital markets. So, what’s the solution?

Enter ZK-proofs. Gluchowski and team have been busy making privacy work without completely cutting off institutions from the outside world. Now, they’re pairing private chains with ZK-proofs, so institutions can keep their data private but still prove to the public network that they’re operating by the rules. The result? The public chain can verify things are running smoothly, but it doesn’t see all the gritty details. Privacy at its finest-minus the creepy peeping.

Institutional Privacy is Coming to Life

By early November, Nansen showed ZKsync taking the lead in fee growth over a seven-day period. Gluchowski wasn’t impressed by retail speculation; no, it was the excitement following new tokenomics and staking proposals. “We rolled out new proposals, and bam! The interest shot through the roof. Prices went up, volumes went up, and people are now diving into ZKsync Era. We also rolled out pilot staking, and now everyone’s curious,” he said. Is there anything better than a surprise surge? This is blockchain drama at its finest.

While consumer-facing use cases continue to expand, Gluchowski is clear on where the next wave of blockchain activity will come from: the big players. Institutions are the ones who can’t operate on transparent ledgers without exposing all their dirty laundry. Privacy is the golden ticket to participating in shared settlement infrastructure. And ZKsync is positioning itself as a network of chains-not just a rollup-so financial firms can operate in a controlled environment. Some are already testing it, and Gluchowski expects production deployments to begin before the end of the year.

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2025-11-11 17:08