Zcash big pump 200% in ten days! A comment from a Silicon Valley guru ignites a frenzy of Privacy Coin.

Famous Silicon Valley angel investor Naval Ravikant said, "Zcash is the insurance against Bitcoin," triggering a collective big pump in the Privacy Coin sector. Zcash soared from $70 to $240 within ten days, an increase of over 200%, while Privacy Coins like Dash, Railgun, and Tornado Cash also experienced a big pump. Why has this long-marginalized sector, which has been under regulatory pressure, suddenly become the focus of capital?

Privacy Coin Collective Surge: A Single Sentence Changes the Market Narrative

(Source: CoinMarketCap)

On October 10, an unexpected phenomenon occurred in the cryptocurrency market: the long-marginalized Privacy Coin sector suddenly experienced a broad pump. Privacy Coin projects such as Zcash, Dash, Railgun, Verge, and Tornado Cash, which are ranked among the top by market capitalization, all recorded significant increases. These coins, which had been delisted by mainstream exchanges and viewed as thorns in the side by regulatory authorities, suddenly returned to the spotlight after years of silence, leaving the market feeling both surprised and confused.

Privacy Coins have always been the most controversial category in the cryptocurrency space. The anonymous transaction features they offer, while aligning with the concepts of "decentralization" and "privacy protection" in cryptocurrency, have also made them the preferred tools for hackers to launder money, leading to long-term scrutiny and crackdown from global regulatory bodies. Regulatory authorities in many countries have required exchanges to delist privacy coins, citing that they may be used for illegal activities. In this regulatory environment, the market performance of privacy coins has remained sluggish for a long time, causing investors to steer clear of them.

However, this collective explosion of Privacy Coins did not stem from technological breakthroughs, policy relaxations, or significant partnerships, but rather from a statement made by a Silicon Valley celebrity. This seemingly simple comment triggered a chain reaction within the cryptocurrency community, fundamentally altering the market's perception of the value of Privacy Coins. In the highly interconnected cryptocurrency market, the influence of opinion leaders' statements sometimes far exceeds fundamental factors, and this big pump of Zcash and the entire Privacy Coin sector is the best example.

Naval Ravikant's Quote Ignites the Market: Zcash is the Insurance Against Bitcoin

The fuse of this Privacy Coin craze was a brief post made by well-known Silicon Valley entrepreneur and angel investor Naval Ravikant on October 1 on the X platform. This legendary investor, who has invested in well-known companies like Uber and Twitter, expressed his understanding of the value tiers of cryptocurrency in extremely concise language: "Bitcoin is insurance against fiat currency. Zcash is insurance against Bitcoin."

This sentence seems simple, but it contains profound philosophical thoughts. Naval Ravikant positions the value of cryptocurrency as a form of "insurance" mechanism and cleverly establishes a three-layer protection system: fiat currency, Bitcoin, and Zcash. This analogy quickly sparked heated discussions within the cryptocurrency community, and many investors began to reassess the strategic value of Privacy Coins.

The community's interpretation of Naval Ravikant's statement is that Bitcoin, after more than a decade of development, has been widely recognized as an effective tool for hedging against the devaluation of fiat currencies. When central banks around the world print money in large quantities, leading to a decline in the purchasing power of fiat currencies, Bitcoin's fixed supply and decentralized nature make it an alternative choice for value storage. This narrative has gained some recognition from institutional investors and the mainstream financial community after experiencing multiple financial crises and inflation.

However, Bitcoin itself has a potential vulnerability: its blockchain is completely transparent. Anyone can trace the entire transaction history of any address. This transparency, while ensuring the system's auditability, may also pose a privacy risk for coin holders. Governments, hackers, or anyone with ill intentions could track the flow of funds through blockchain analysis techniques, which is a real threat for large coin holders.

Privacy coins like Zcash were created to address this issue. Through advanced cryptographic techniques such as zero-knowledge proofs, Zcash is able to completely hide transaction amounts, sender and receiver information while maintaining the verification functions of the blockchain. In Naval Ravikant's framework, if Bitcoin is the first layer of protection (against fiat currency risks), then Zcash is the second layer of protection (against Bitcoin transparency risks). This redefinition of "blockchain transparency" from an advantage to a "defect" that needs to be hedged represents a highly disruptive shift in thinking.

Naval Ravikant's words carry significant weight not only because of his esteemed position in the Silicon Valley tech scene and the investment world but also due to his reputation for deep thinking and long-termism. His statements on wealth, happiness, and life philosophy have millions of followers on social media and are seen as symbols of wisdom. When such a thought leader publicly endorses Zcash, the market's reaction is immediate.

Zcash Big Pump 200% in Ten Days: From Marginal Coin to Market Focus

(Source: Trading View)

The market's reaction speed and intensity to Naval Ravikant's remarks exceeded expectations. After being mentioned, Zcash's price quickly entered a big pump mode. In just ten days, its price skyrocketed from 70 USD to 240 USD, an increase of over 200%. Such a surge is not uncommon in the cryptocurrency market, but considering that Zcash is neither an emerging meme coin nor a hot concept coin, but rather a mature project that has been operating for many years with a relatively large market capitalization, this kind of rise is still quite astonishing.

From a technical perspective, Zcash's big pump exhibits typical "narrative-driven" characteristics. The price began to fluctuate after Naval Ravikant's post on October 1, initially likely due to some sharp investors capturing this new narrative and starting to build positions. As the price rose, more people took notice of this dynamic, and discussions about Zcash and Privacy Coins rapidly increased on social media, forming a positive feedback loop. FOMO (fear of missing out) sentiment began to spread, with more and more capital flowing in, driving the price to accelerate upward.

This wave of pump has also driven the revival of the entire Privacy Coin sector. Other Privacy Coin projects such as Dash, Railgun, Verge, and Tornado Cash have all followed suit, although their gains are not as astonishing as Zcash, they have also recorded considerable returns. The market seems to have suddenly realized that privacy is not just a demand, but also a value that has not yet been fully priced. In a bull market environment where the price of Bitcoin has already broken through 120,000 USD and Ethereum has stabilized at 4,000 USD, funds are beginning to seek new narratives and potential high-yield opportunities, and Privacy Coins have just gained a strong new narrative support at this time.

However, investors also need to remain rational. The surge from $70 to $240 is tempting, but it also means that a large amount of profit-taking has accumulated in the short term. Any negative news or changes in market sentiment could trigger selling pressure from profit-taking. In addition, the regulatory risks facing Zcash have not disappeared because of a famous quote; governments around the world still maintain a severe stance against Privacy Coins, which is a long-term risk factor that investors must consider.

The Double-Edged Sword of Privacy Coins: Protecting Privacy or Money Laundering Tool

The big pump of Zcash and other Privacy Coins has reignited a long-standing controversy: the balance between privacy protection and regulatory compliance. Supporters of Privacy Coins argue that financial privacy is a fundamental human right, and individuals and businesses have the right to protect their transaction information from arbitrary scrutiny. In a naturally transparent system like blockchain, the absence of privacy protection mechanisms means that all financial activities are exposed to public scrutiny, which in certain situations may pose security risks, business secret leaks, or personal privacy infringements.

From this perspective, Naval Ravikant's positioning of Zcash as "insurance against Bitcoin" indeed hits the mark. Imagine if your Bitcoin address is publicly identified; anyone can see how much Bitcoin you hold, who you are transacting with, where your funds are coming from, and where they are going. For large holders, businesses, or high-net-worth individuals, this level of transparency can become a source of extortion, attacks, or unwanted attention. The privacy protection features offered by Zcash become a necessary safeguard in this context.

However, regulators and critics emphasize another side of Privacy Coins. Due to the completely anonymous transactions, Privacy Coins have become the preferred tools for illegal activities such as money laundering, tax evasion, ransom payments, and dark web transactions. Hackers often use mixing services like Tornado Cash or directly exchange stolen cryptocurrency for Privacy Coins to sever the funding trace chain. This characteristic poses a significant headache for law enforcement and is the main reason many countries require exchanges to delist Privacy Coins.

This dilemma has never had a perfect solution in the cryptocurrency space. Technological neutrality advocates argue that the technology itself is neutral; a knife can be used for cutting vegetables or can harm people, and valuable innovations should not be banned just because they can be misused. However, pragmatists point out that in the current regulatory environment, projects that completely resist regulation find it hard to gain mainstream adoption and may ultimately be marginalized.

The design of Zcash actually attempts to find a balance between the two. Unlike some completely anonymous Privacy Coins, Zcash offers a "selective transparency" feature, allowing users to choose to disclose certain transaction information to meet compliance requirements while maintaining the privacy of other transactions. This design philosophy embodies a pragmatic compromise, trying to find a middle ground between privacy protection and regulatory compliance.

Privacy Coin Investment Opportunities and Risk Assessment

With the big pump of Zcash, many investors are starting to reassess the investment opportunities in the Privacy Coin space. From a narrative perspective, the "multi-layer insurance" framework provided by Naval Ravikant indeed gives a new value positioning to Privacy Coins. Against the backdrop of institutional funds pouring heavily into Bitcoin and Ethereum, if more and more high-net-worth individuals and institutions agree with the view that "privacy is essential", Privacy Coins may attract more funding.

In addition, global geopolitical tensions, increased government surveillance, and heightened awareness of personal privacy are trends that may drive long-term demand for Privacy Coins. In certain regions, political instability or strict currency controls may lead to a particularly strong demand for anonymous asset transfers. From this perspective, Privacy Coins are not only a technological innovation but also a response to specific social needs.

However, investment risks should not be ignored. The primary risk is regulatory suppression, as the hostile attitude of governments towards Privacy Coins is unlikely to change in the short term, and new restrictions may be introduced at any time. Liquidity risk is also a concern; many mainstream exchanges have already delisted Privacy Coins, and the remaining trading venues have relatively poor liquidity, which may face slippage issues for large transactions. There are also technical risks; vulnerabilities in cryptographic systems or the development of quantum computing could threaten the security of Privacy Coins.

For investors considering investing in Privacy Coins such as Zcash, it is recommended to adopt a cautious strategy. Privacy Coins can be viewed as a small allocation in a portfolio, similar to hedging or thematic investments, rather than a heavy bet. Closely monitor regulatory dynamics, technological developments, and changes in the attitudes of major exchanges, as these are key factors influencing the prices of Privacy Coins. At the same time, it is important to recognize that celebrity-driven big pumps are often accompanied by high volatility, and there may be drastic corrections in the short term, making risk management and psychological preparation crucial.