In 2025, on-chain privacy technology has reached a true turning point. Once a niche experiment within the geek community, it has now gained dual recognition from mainstream public blockchains and the capital markets.

Just look at what has happened this year. Zcash's annual increase exceeded 600%, clearly becoming the flagship of the entire privacy track. Meanwhile, leading public chains like Ethereum and Solana are actively promoting their respective native privacy solutions. Privacy infrastructure based on zero-knowledge proofs and fully homomorphic encryption continues to receive funding and market attention.

But this is just the beginning. The truly interesting question is—what will happen next?

I have four core predictions for 2026.

First, privacy features will upgrade from an "optional configuration" to a "standard default." In future blockchain competition, the combination of compliance verification and user privacy will become a core competitive advantage, no longer just an optional feature. This is a qualitative shift.

Second, the scope of privacy applications will be thoroughly expanded. Currently, when people think of privacy, their first reaction is transaction privacy. But by 2026, privacy will penetrate areas such as DeFi interactions, on-chain identity verification, and data trading markets. The combination of zero-knowledge proofs and fully homomorphic encryption will open new imaginative spaces in account abstraction, identity layers, and data layers.

Next, let's consider valuation logic. The market will start to distinguish between "privacy with real technological barriers" and "privacy that is just storytelling." This differentiation will create revaluation opportunities for established projects with actual technological breakthroughs, while also giving rise to new privacy sector leaders.

Finally, regulation is also crucial—regulators will not simply eliminate privacy through brute force, but will reshape the expression of privacy. Features like auditability and user-controlled disclosure will gradually become essential survival conditions for privacy protocols. This is not a restriction; rather, it signifies the maturity of privacy technology.

The privacy ecosystem in 2026 will be more complex and more vibrant than we imagine.