ShapeShift has reintroduced support for shielded transactions using the Zcash privacy cryptocurrency. This shift indicates a renewed focus on privacy following its transformation into a DEX aggregator.

According to details shared with Cointelegraph, ShapeShift’s self-custodial decentralized exchange and wallet now support Zcash (ZEC) shielded transactions. This announcement also comes with the news that Zcash Community Grants have allocated $50,000 to assist in ShapeShift’s technical and marketing efforts.

This strategic move aims to “provide true on-chain privacy for users.”

The announcement follows ShapeShift’s earlier decision to delist privacy-focused coins in 2020 amid rising regulatory scrutiny; a time when it functioned as a centralized exchange. After changing to a DEX aggregator, it eliminated Know Your Customer (KYC) burdens the subsequent year.

Integrating shielded ZEC into the ShapeShift DAO expands the community’s ability to access and utilize private currency, promoting the core values of privacy and self-custody that Zcash embodies.

A representative of ShapeShift’s decentralized autonomous organization highlighted that, “ShapeShift is now a DAO, no longer the centralized entity it was in 2016.”

Firstov told Cointelegraph that “privacy is fundamental to trust.” He elaborated, explaining that Zcash employs zero-knowledge proofs to enable private transactions where details like the amount sent, sender, and receiver remain confidential.

As Zcash continues to grow since its launch in 2016, the development of zero-knowledge proofs has also gained traction. Such methods allow users to validate truths without disclosing personal information.

Recent regulations, however, suggest challenges ahead for crypto privacy advocates. Reports indicate that new European Union Anti-Money Laundering regulations may soon outlaw privacy-preserving tokens, a move anticipated by 2027.

This potential for heightened regulation has led to predictions of increased demand for censorship-resistant assets in the evolving landscape.