Key Insights:
- Balaji Srinivasan says crypto has moved into a new privacy era, powered by zero-knowledge proofs.
- He outlined crypto’s evolution from proof-of-work to smart contracts and now privacy-focused systems.
- Zcash and Cardano’s Midnight reflect growing interest in privacy-based blockchain networks.
The crypto industry entered a privacy era in December 2025, according to comments made by Balaji Srinivasan in Dubai. Speaking at the Binance Blockchain Week, he explained how crypto moved from proof-of-work to smart contracts.
Crypto is now focused on privacy, driven by zero-knowledge proofs that protect user data.
How the Crypto Privacy Era Fits Into Crypto’s Past and Present
The crypto privacy era was outlined by Balaji Srinivasan, a former Coinbase Chief Technology Officer, during Binance Blockchain Week 2025 in Dubai. He described crypto development as a clear timeline with three stages. The first stage ran from 2009 to 2017.
This period focused on proof-of-work systems and network security. Bitcoin showed that decentralized consensus could operate without a central authority.
Notably, Srinivasan said security concerns dominated early development. Developers worked to ensure systems could resist attacks. The goal was trust through math, not institutions. This phase laid the foundation for everything that followed.
The second phase began around 2017 and lasted until 2025. It focused on programmability and scaling. Platforms such as Ethereum and Solana allowed developers to write smart contracts. These contracts enabled decentralized finance, token trading, and NFTs.
Srinivasan pointed to Uniswap as proof that smart contracts could handle real financial activity.
He said this stage showed that on-chain applications could work and grow. While scaling issues persist, he suggested that the core ideas have been proven.
According to Srinivasan, crypto has now entered its third phase. This phase centers on privacy and encryption. Developers aim to protect data while keeping networks verifiable. Zero-knowledge proofs play a central role in this approach.
Zcash and Midnight Reflect the Privacy Era Shift
The privacy era idea connects closely with existing privacy-focused networks. Zcash is one of the earliest examples. It uses zero-knowledge proofs to hide transaction details. Users can send funds without revealing addresses or amounts. This design allows verification without public exposure.
Recent market activity suggests renewed interest in privacy assets. Cardano’s Midnight token, NIGHT, rose 6.53% in 24 hours. Trading volume reached $111.93 million.
This level is below Zcash, which recorded $679.52 million in transaction volume during the same period. ZEC gained 13.81% over that time.
Midnight is a privacy-focused sidechain developed by Input Output Global. It aims to add private transactions and smart contracts to the Cardano ecosystem.
The design avoids changes to Cardano’s main structure. Community support and public remarks from Charles Hoskinson helped draw attention to the project.
It is worth noting that Zcash and Midnight use similar cryptographic ideas but differ in structure. Zcash operates as a standalone privacy network. Midnight is built to work alongside an existing chain. Both highlight how privacy tools are gaining relevance across different models.
Why the Privacy Era May Shape the Future of Blockchain Use?
The privacy era could influence how developers and users approach blockchain systems. Privacy tools allow sensitive data to remain hidden while transactions stay valid. This balance may support wider use in finance and identity systems.
Srinivasan did not predict immediate results from this shift. His comments framed privacy as a long-term direction. He suggested future systems may encrypt most user activity by default. Zero-knowledge proofs make this possible without breaking verification.
Market data indicate a growing interest in privacy-focused projects. Increased trading activity suggests investors are watching these developments closely.
Developers may also explore privacy features to meet regulatory and user needs. Security and scalability remain important concerns. While privacy does not replace them, it adds another layer to system design.
Notably, the privacy era reflects an effort to protect users while keeping open networks functional.