The rise of privacy coins: We only care when privacy is at risk | Opinion

As a fervent advocate for privacy and security in the digital age, I find myself deeply moved by Quinten van Welzen’s dedication to this cause. His journey in the crypto industry spanning over five years is nothing short of inspiring, especially when you consider his early entry into this space back in 2017.


Summer. The sunlight filters through my curtains. The forecast predicts one of the hottest days of the year, but I remain frozen in bed, reluctant to move, the weight of the world pressing me down. My phone screen lights up, and the first headline catches my eye: “29-year-old Bitcoiner robbed and murdered in Kyiv for $200,000 in Bitcoin.” The heat outside feels distant compared to the chilling realization that danger hides in plain sight in a world where privacy is increasingly elusive.

The story didn’t reveal how the accused found out about the man’s Bitcoin (BTC) savings. But it appears they knew confidential details about their victim’s Bitcoin and have been charged with planning a murder, robbery, and hiding evidence, suggesting that they somehow uncovered this information.

Privacy is not just a convenience; it’s a fundamental right

After finishing the news article, it brought to mind an article titled “Crypto Privacy Is Humanitarian” by Neeraj Agrawal in Bankless. In this piece, Agrawal effectively makes the case for the significant importance of privacy tools in today’s context. He underscores how “cryptocurrency privacy could mean the difference between life and death” for people living under oppressive regimes. He presents numerous instances where maintaining privacy through cryptocurrencies has served as a crucial way to bypass financially restrictive measures imposed by powerful intermediaries.

His examples include protestors in countries like Belarus and Nigeria, political opposition in Russia, resistance fighters in Myanmar, Afghan civilians struggling under sanctions, and a Chinese artist avoiding censorship.

Agrawal’s arguments emphasize that privacy isn’t just about comfort for some; it’s a crucial matter of life and death for numerous individuals globally. Yet, overemphasizing these extreme scenarios might lead people to think that privacy is only vital in emergency situations. In truth, privacy is a basic human right that doesn’t require explanation or validation. This perspective can also contribute to the belief that those advocating for privacy or challenging Know Your Customer regulations are concealing illegal activities, which further tarnishes the reputation of personal privacy pursuit.

As a researcher, I’ve noticed that the common perspective often portrays privacy concerns as existing on a spectrum, with those concealing illicit activities at one end and activists evading persecution at the other. Both are typically viewed as lawbreakers, yet one is vilified while the other is lauded, even when the laws themselves may be repressive or unjust. However, this divide fails to acknowledge the multitude of ordinary people in between—individuals who simply value their privacy without sensationalistic reasons or anything to hide.

Privacy is like oxygen: Its value becomes apparent only in its absence 

It appears that the surge in interest towards privacy coins is closely tied to the growing number of central banks investigating central bank digital currencies. As per a survey by the Bank for International Settlements, 94% of the 86 banks involved expressed an interest in a digital form of their national currency, compared to 90% of 81 respondents in a 2021 BIS survey – demonstrating a growing trend. This shift comes as a response to heightened worries over the loss of financial privacy, with privacy coins stepping forward as a possible remedy for these concerns.

Beyond this, it’s often when our privacy is threatened that privacy-focused cryptocurrencies garner significant media attention. A notable example is Vitalik Buterin, co-founder of Ethereum (ETH), who underscored the importance of privacy in crypto transactions after news broke about his use of the privacy tool RailGun to conceal a 100 ETH transfer. As reported by Wu Blockchain, citing data from Arkham Intelligence, Buterin had been incrementally engaging with this privacy tool for approximately six months, employing smaller amounts of ETH in the process.

Today at 17:40 UTC+8, Vitalik Buterin (vitalik.eth) moved 100 ETH, roughly equivalent to $325,000, to an account known as Railgun. Railgun is a privacy protocol for the Ethereum Virtual Machine (EVM), which facilitates private transactions within DeFi. Over the past six months, Vitalik Buterin has been engaging with Railgun using small amounts of Ether.— Wu Blockchain (@WuBlockchain) April 15, 2024

As an analyst, I’ve noticed a surge in the value of privacy-centric digital assets like Monero (XMR) following Buterin’s recent actions. This increase averaged more than 5%. However, it’s worth noting that those championing privacy protocols often face a negative stereotype, being labeled as paranoid conspiracy theorists or extremists, despite their crucial role in safeguarding financial privacy.

People tend to view with suspicion those who don’t openly share information in line with societal expectations of transparency. This public shaming of privacy advocates can function subtly as a method for exerting social control, encouraging complacency. Over time, this can lead us towards a society heavily reliant on surveillance, where personal data is effortlessly gathered, manipulated, and employed to exercise control.

How big is crypto crime, really?

Illicit activity remains a concern within the crypto world, with some harmful to honest users—such as scams and hacks—while other actions, like circumventing government-imposed capital controls, may seem to challenge unfair systems. Critics of privacy coins often focus on their use in illicit activities, but they fail to put this issue into a broader context. Blaming the tools rather than addressing the underlying human behaviors misses the point. 

For ages, illegal activities have been prevalent, and they’re not confined to any specific type of technology. While cryptocurrencies can potentially be misused for illicit purposes, such actions would persist regardless of their existence. Instead, our efforts should concentrate on tackling the underlying issues that give rise to these problems, rather than stigmatizing the tools themselves.

Approximately $2 trillion is estimated to be involved in money laundering activities through conventional financial systems each year, a sum nearly equivalent to the total value of all cryptocurrencies. Moreover, more than 99.9999% of Bitcoin transactions take place on platforms that follow anti-money laundering guidelines.

Last January 2023, Chainalysis revealed that cryptocurrency transactions linked to suspect addresses amounted to approximately $24.2 billion. This figure represented a mere 0.34% of the overall crypto transaction volume for that year. Notably, this was a decrease compared to the previous year when illicit activities were responsible for $39.6 billion in transactions, equating to 0.42%. In simpler terms, in 2023, less than 1 out of every 300 crypto transactions was linked to illegal activity, which was lower than the rate in 2022.

One issue when determining the scale of illegal activity is differentiating between individuals who own cryptocurrencies and those using it for transactions. Many people purchase Bitcoin mainly as a long-term investment, which could mean that an increased number of active users may be engaged in illicit activities. This difference complicates the ongoing discussion about crypto regulation.

It’s preposterous to claim that the vast majority of people holding privacy coins are involved in illegal activities. This perspective contradicts the core values that many web3 enthusiasts uphold: freedom, including essential human rights such as privacy. For them, privacy is not merely a means to protect themselves from wrongdoers or intrusive authorities; it’s about regaining control over their personal information and transactions. They are not concealing illicit activities but asserting that privacy is a basic human right, one that should be respected rather than restricted or stigmatized.

It’s overly simplistic to assume that valuing privacy equates to hiding something illicit. Just like freedom of speech and the right to gather peacefully, privacy should be respected without any conditions or judgments about its use.

The rise of privacy coins: We only care when privacy is at risk | Opinion
Quinten van Welzen

Quinten van Welzen serves as the marketing and community manager for Zano, a blockchain platform focusing on privacy and security. With over five years of experience in the cryptocurrency sector, Quinten has been passionate about developing and implementing blockchain technology to improve digital privacy. Originally hailing from the Netherlands, he was drawn into the crypto world in 2017 by his fascination with blockchain technology and its potential to transform numerous aspects related to digital privacy and security. In his role at Zano, Quinten not only emphasizes the technical advantages of their platform but also works towards building a knowledgeable and supportive community around Zano’s innovative solutions.

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2024-10-03 13:48