Economist Saifedean Ammous stirred considerable discourse on social media by evaluating the relevance of privacy-centered cryptocurrencies such as Zcash in relation to Bitcoin.
Ammous posed this provocative question:
“How much demand is there for money that does not get debased versus how much demand is there for money that allows you to maintain your privacy?”
In a highlighted statement, he referred to Zcash as a “shitcoin” due to its inception involving a trusted setup ceremony back in 2016 for generating its privacy framework.
“The whole thing is built on a trusted setup, where you have to trust a bunch of people who started the whole thing. I’m not in any mood to get into these kind of stupid games.”
Although Ammous admitted a lack of profound knowledge about Zcash’s protocol, he raised concerns regarding the implications of its privacy features on community trust regarding the total supply of ZEC tokens:
“As I understand, the anonymity benefits come at the expense of the auditability benefits.”
Zcash allows for the use of shielded and unshielded transactions, with shielded ZEC transactions being both encrypted and private, concealing details like the sender, receiver, and amount from the public ledger. This protection is achieved via zero-knowledge proofs that validate transactions without disclosing sensitive data.
Nonetheless, Ammous’s critiques raise questions, as shielded and unshielded pools of Zcash remain verifiable on various blockchain explorers.
Privacy vs. Hard Money
Prominent figures in the cryptocurrency sector shared their views on an X post showcasing Ammous’ comments on the balance of privacy in monetary use.
Helius’s co-founder, Mert Mumtaz, called Ammous’ view a false dichotomy:
“You should have money that is not debased and is private. That’s zcash. Further, you just can’t have money that’s free from the state unless it’s private. If it can be seen, it can be seized.”
Barry Silbert, founder and CEO of Digital Currency Group, asserted that privacy remains paramount for Bitcoin enthusiasts:
“I’m old enough to remember when all hardcore Bitcoiners cared about privacy. Fortunately, many still do.”
Zooko Wilcox, co-founder of Zcash, highlighted that state authorities tracked Bitcoin addresses linked to protestors due to Bitcoin’s transparency.
Amidst ongoing debates, Ammous remarked on the evolution of privacy in blockchain technologies, suggesting that Bitcoin’s desired privacy aspects may transition to layer-2 solutions:
“On the issue of privacy, it’s interesting how it’ll evolve. One unpopular opinion I have is that on-chain privacy is very difficult and continues to get more difficult.”
Eventually, Ammous reiterated his core belief that hard money is crucial for economic well-being:
“I think people would rather have hard money that is not private, over easy money that is private. The narrative that people want privacy in their money, I think is massively overblown in order to produce marketing for shitcoins.”
As we approach the end of 2025, interest in Zcash has surged, with its market cap reaching an astonishing 10x increase recently. Zcash prominently featured at the top of Coinbase’s search rankings in November.
