Privacy tokens have surged against the recent market downturn, with both price and popularity skyrocketing, but most discussions have focused on consumer-facing projects like Zcash.
Meanwhile, banks and financial institutions have been exploring zero-knowledge (ZK) systems, which can enable private transaction flows on the blockchain, a technology known for its transparency and immutability.
As Alex Gluchowski, CEO of Matter Labs, stated, “There is cryptopunk privacy, which is account-level privacy, and there is institutional privacy, which is system-level privacy. Institutions need complete visibility into their flows while keeping that data confidential from others.”
Gluchowski first encountered Bitcoin in 2014 while working in the startup space, but shifted to Ethereum's smart contracts during the initial coin offering era because they enabled new use cases. The scalability issues, particularly ZK proofs, attracted him to establish Matter Labs, the developer of the Ethereum Layer 2 network ZKsync.
According to CoinGecko, as of early November, over 140 companies hold approximately $137 billion in crypto assets on their balance sheets. However, Gluchowski told Cointelegraph that the next phase of financial institutions moving payment or settlement flows to public blockchains can only happen with a reliable privacy layer due to the existence of confidentiality obligations.
Recent cycles of the crypto bull market have highlighted prolonged speculative behavior, with trends having little connection to real-world utility.
“We have a strange obsession with non-productive assets in the crypto space, which is clearly unsustainable,” Gluchowski said, adding that consumer growth in crypto has reached a plateau.
Privacy, however, is different; it directly relates to how the financial system operates and has not been fully explored in previous cycles, constrained on one hand by regulatory pressure and on the other by exchanges delisting related tokens and events like the U.S. government's sanctions on Tornado Cash.
This situation has changed since the current U.S. government adopted a more selective strategy, distinguishing “privacy” as a technical capability separate from its use for illegal financing.
Alex Gluchowski stated, “It’s a world of difference. No one dared to touch cryptocurrency before—it was almost a taboo topic. Now the attitude has shifted to ‘we must embrace this technology, or we will be left behind.’”
He believes that while changes on the consumer side are the most visible, the real driving force comes from institutional demand. Banks, asset management companies, and enterprises cannot settle on a fully transparent public blockchain ledger, as internal cash flows, counterparty information, or financial operations would be exposed to the public.
For this reason, the Ethereum ecosystem is beginning to refocus on privacy issues. Alex Gluchowski explained that this topic is seen as a system-level requirement, allowing institutions to trade on shared infrastructure while maintaining visibility and control over internal cash flows.
The privacy model required by institutions is vastly different from that of ordinary users. They do not seek to hide individual addresses but need a dedicated execution environment where they can control all transaction details while the outside world remains unaware.
If sensitive payment data must be shared with external validators or third-party infrastructure, then so-called “privacy” becomes merely a contractual promise, losing its cryptographic assurance.
Alex Gluchowski said, “You can only achieve incorruptible privacy when the data always resides on your own controlled device. If you share the data with others and then sign an NDA, it is no longer truly incorruptible; it’s just a promise.”
Early enterprise blockchain experiments faced this issue. Financial institutions deployed private chains using frameworks like Hyperledger Fabric or Corda to keep data internal, but these networks remained isolated from the broader liquidity and settlement infrastructure formed around public blockchains.
Alex Gluchowski pointed out, “If you build a completely closed proprietary chain, it won’t connect to anything. It’s just slightly better than a database and cannot access public capital markets.”
He believes that the Ethereum ecosystem is currently trying to solve this trade-off dilemma by combining locally operated proprietary chains with ZK proofs, allowing institutions to retain transaction data internally while proving compliance to the public network. The public chain cannot see specific details but can verify that the rules have not been violated.
Data from Nansen in early November indicated that ZKsync led the industry in fee growth over a seven-day period. Gluchowski attributed the growth to the new token economics and activity following the release of staking proposals, rather than retail speculation.
“We released a proposal for new token economics for ZK tokens, and then we saw a surge of interest,” Gluchowski said. “Token prices rose, trading volume increased, and there was a lot of activity on ZKsync Era. We also announced the pilot implementation of staking at the same time, and many people are now exploring it.”
Consumer-facing crypto application scenarios continue to expand, but Alex Gluchowski emphasized that the next wave of scaling belongs to institutional users who cannot operate their businesses on transparent ledgers. “When participating in shared settlement infrastructure, ‘privacy’ has become a necessity for operations.”
Today, ZKsync is positioned as a network composed of multiple chains rather than a single rollup, including system nodes operated by financial enterprises in a controlled environment.
Some nodes have already entered the testing phase, and according to Alex Gluchowski, the first formal production environment deployment is expected to be completed by the end of the year.
Related: Visa pilots stablecoin payment services for U.S. businesses with fiat funding
Original article: “ZKsync Developer Says Privacy Tools Are Quietly Rising with Accelerated Institutional Adoption”
免责声明：本文章仅代表作者个人观点，不代表本平台的立场和观点。本文章仅供信息分享，不构成对任何人的任何投资建议。用户与作者之间的任何争议，与本平台无关。如网页中刊载的文章或图片涉及侵权，请提供相关的权利证明和身份证明发送邮件到support@aicoin.com，本平台相关工作人员将会进行核查。
