The privacy coin boom taking place in 2025 is no coincidence.
Key industry stakeholders have time and again pushed back strongly against rules that leave no breathing space for crypto. The latest to have his say is Ethereum co-founder Vitalik Buterin.
What’s happening?
Buterin has strong opinions against the European Union’s Digital Services Act (DSA). In a recent X post, the Ethereum co-founder warned that the law risks creating a digital environment where there is “no space” for controversial ideas or products to exist at all.
“I hope European govs do not go this way, and instead take a Pirate Party approach of user empowerment.”
While the DSA aims to make online platforms safer and more accountable, Buterin argued that this philosophy is flawed. He believes the problem isn’t that unpopular or extreme ideas exist, but that algorithms often amplify them at scale. Trying to erase such ideas entirely, he said, risks encouraging excessive surveillance and enforcement.
“There is a real opportunity to reaffirm freedom of speech in a unique and different way, that emphasizes pluralism and pushes against unbalanced attempts to manipulate the discourse…”
Privacy coins take the lead
This control and freedom discord is starting to impact the numbers. While most crypto sectors have struggled this year, privacy coins are moving in the opposite direction.
In fact, data from Artemis revealed that they are the best-performing sector YTD, far outperforming everything else.
While Bitcoin [BTC] remains the market’s anchor, its performance this cycle has been relatively restrained.
Over the same period that Bitcoin has struggled to push higher, Zcash [ZEC] has surged by more than 700%. Monero [XMR] has held its ground with far less downside too.
Trading activity is rising as well, with privacy coins climbing the rankings by volume and market cap. As regulations increase, capital is rotating towards assets built to preserve the holder’s autonomy.
Europe’s push gains pace
All of this is playing out against a busy year for crypto regulation in Europe. In 2025, the EU went from talking about rules to actually enforcing them. MiCA officially kicked in, forcing crypto firms to get licensed, get their disclosures in place, and rethink which tokens they can offer users.
Stablecoins have been under scrutiny, with regulators asking platforms to phase out non-compliant options. At the same time, new rules around cybersecurity and operational risk took effect. Anti-money laundering bodies made it clear that crypto is now a priority area too.
There’s also new sanctions and stricter oversight. Europe’s crypto market is now a heavily controlled arena.
This isn’t new…
U.S sanctions on Tornado Cash turned a niche crypto tool into a big debate about privacy and control. Since then, exchanges have delisted privacy coins like Monero because compliance got harder.
Japan banned privacy coins years ago and other countries followed with restrictive rules. Interest moves elsewhere when access is restricted. Even recent court decisions around Tornado Cash were followed by attention on privacy coins.
That’s why this matters. Europe is pulling the strings tighter, and privacy coins are rising again. Buterin’s warning about leaving “no space” for controversial tools fits into this pattern.
When systems squeeze out privacy, people look for it even harder, don’t they?
Final Thoughts
- Privacy coins are the best-performing crypto sector of 2025.
- As Europe enforces MiCA and the DSA, capital is rotating towards privacy-first cryptos.
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