What are Privacy Coins?

Figure:https://www.coingecko.com/en/categories/privacy-coins

Privacy Coins, also known as privacy tokens, aim to protect the anonymity and untraceability of on-chain transactions.

• Core purpose: Hide the information of the transaction initiator, receiver, and amount.
• Common technologies: Ring Signature, CoinJoin, Zero-Knowledge Proof (ZKP).

Unlike transparent chains like Bitcoin and Ethereum, privacy coins focus more on transaction anonymity, making them suitable for users with high privacy requirements.

Top 10 Privacy Coins Overview

The following rankings are based on CoinGecko market capitalization (May 2025):

• Anonymity Strength: Monero uses ring signatures and confidential transactions, making it almost untraceable; Zcash offers optional privacy, making transparent transactions more efficient.
• Audibility: Some projects support selective disclosure (Zcash, Dash), suitable for compliance scenarios.
• Network scale and security: Market capitalization and number of nodes affect the degree of decentralization, Monero and Dash networks are more robust.

Highlights and Applications of Each Token

Monero (XMR)

• Ring Signature + Confidential Transactions, the strongest privacy protection;
• Widely used in privacy-sensitive scenarios.

Zcash (ZEC)

• Zero-Knowledge Proof Protocol (zk-SNARKs);
• Supports both transparent and private transactions.

Dash (DASH)

• PrivateSend Coin Mixing Service;
• Dual-layer governance structure (Masternode and miners).

Beldex (BDX)

• Integrated mixing of coins and decentralized storage;
• Focus on social payment privacy.

MimbleWimbleCoin (MWC)

• Based on the MimbleWimble protocol, transaction volumes can be aggregated;
• Lightweight and strong scalability.

Others such as Decred, Zano, Verge, Railgun, Nym, etc., each have their own characteristics in cross-chain privacy, sidechain privacy, smart contract privacy, and network-level anonymous communication.

How to participate and purchase?

Image:https://www.gate.io/trade/BDX_USDT

Download wallet: Choose the official wallet or a hardware wallet that supports privacy features.
Purchase channels: mainstream exchanges（Gate.io）or decentralized exchange.
Deposit coins and mix coins: After transferring to the wallet, you can use coin mixing services (such as Dash’s PrivateSend) to enhance anonymity.
Node participation: such as Dash Masternode, Decred Stake Pool, can receive additional rewards.

Investment Advice and Risk Warning

• Liquidity risk: Privacy coins may experience significant slippage due to insufficient depth on certain exchanges;
• Regulatory risks: Different countries have different policies on anonymous coins, and some platforms may delist them;
• Technology upgrade risk: If the protocol upgrade is not fully audited, there may be smart contract or network security vulnerabilities;
• Anonymity vs. Compliance: Trading completely anonymously may trigger KYC/AML checks.

It is recommended for beginners to start with high market value projects, control positions, and diversify investments.

Future Outlook

With the increasing strictness of blockchain regulations and compliance requirements, privacy coins will explore mechanisms of ‘optional privacy’ and ‘selective disclosure’; at the same time, zero-knowledge technology upgrades (such as zk-STARKs) will drive more protocols to achieve high-intensity privacy protection while maintaining performance.

The new generation of privacy chains (such as Railgun, Nym) focuses on application-layer anonymous communication and cross-chain privacy, providing richer privacy solutions for future decentralized finance and social payment scenarios.