Zcash (ZEC), a privacy coin that launched in 2016, unveiled an upgrade to its system on May 31 that will allow users to more easily make private, trustless digital cash payments on mobile phones. Not everyone would view this as a good development.
The unfamiliarity, uncertainty and public intrigue surrounding privacy — including its complexity, misuse and speculative activity — presents a number of challenges and reputational issues for innovating crypto projects. While a core tenet and source of pride among crypto projects such as Zcash, privacy has been demonized by those in power, including lawmakers, regulators, banks and academics.
Yet, frequent hacks and data breaches show that the need to protect individuals’ privacy is more essential than ever. It’s here where crypto firms can enter the conversation and advocate for these vital consumer protections through the use of privacy-focused projects.
Related: What are privacy coins and how do they differ from Bitcoin?
Consumer sentiment and corporate malfeasance
Sentiment toward the need for data and financial privacy entered the mainstream when the extraordinary revelations of the 2017 Equifax breach came to light. The most sensitive financial information of nearly every American household was put in the hands of third-party providers without their knowledge or informed consent — and was not appropriately protected.
Americans have long been walled off from our most sensitive financial information. Due to the negligence of Equifax, we now know just how vulnerable our privacy and financial security truly is. Things have only gotten worse in the succeeding years. Nearly 294 million people were impacted by data breaches in 2021, with more than 18.5 million records exposed. It was the worst year for corporate data breaches since 2017.
Takeaway: The crypto industry needs a villain. We need a drumbeat of proactive outreach to mainstream consumers reminding them of the unethical practices of companies who both fail to protect their information and use it deceptively. But it can’t be a “tear it all down and exit the system” message. We have to also educate people on how Web3 prevents this from happening but putting them in control of their data.
Related: The loss of privacy: Why we must fight for a decentralized future
Policymakers take notice
The scandal surrounding the loss of control of our financial information caught the attention of policymakers, some of whom…
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