Privacy coins are gaining a place in regulated investment markets even as direct access to their underlying assets becomes harder. Grayscale’s Zcash ETF now trades on NYSE Arca, while major centralized exchanges have reduced support for Monero and other privacy-focused cryptocurrencies. THORChain’s latest upgrade shows how decentralized infrastructure could help close that access gap.
Privacy is reaching Wall Street as exchange access shrinks
Privacy in crypto is moving in two directions at once.
On one side, it is entering the financial mainstream. Grayscale’s Zcash ETF, ZCSH, began trading on NYSE Arca on Aug. 25. Grayscale described it as the first exchange-traded product to offer spot exposure to Zcash ($ZEC).
The fund gives US investors a way to gain $ZEC exposure through a regular brokerage account. They do not need to open a crypto exchange account, manage private keys, or hold the asset in a personal wallet.
On the other hand, directly buying, selling, and moving privacy coins has become more difficult in several markets. Centralized exchanges have removed assets or restricted access as regulators apply tighter anti-money-laundering standards.
The contradiction is hard to miss. Wall Street can now package exposure to a privacy-focused asset inside a regulated fund, while parts of the crypto market are becoming less willing or less able to support the underlying coins.
THORChain’s v3.20 upgrade matters within that divide. The release laid technical groundwork for native Monero ($XMR) and Zcash swaps alongside assets such as Bitcoin (BTC), Ethereum (ETH) and stablecoins.
However, THORChain said after the upgrade that the Monero and Zcash rollout had been delayed while contributors focused on network stability. The protocol’s interface for supported cross-chain trades is available through its native swap platform, with $XMR and $ZEC access dependent on their final activation.
Monero delistings show the cost of centralized access
Monero provides the clearest example of how a permissionless cryptocurrency can remain operational while becoming harder to reach.
Binance removed $XMR in February 2024, while OKX also ended support for Monero trading pairs. Kraken later stopped $XMR trading and deposits for customers in the European Economic Area, citing regulatory changes.
Those decisions did not shut down Monero. The blockchain continued processing transactions, and users could still send $XMR between compatible wallets. What changed was access to the services that many people use to enter or leave the market.
Monero is private by default. Its design conceals the sender, receiver, and transaction amount. Supporters see those protections as the digital equivalent of the privacy available when paying with physical cash.
The same design creates problems for centralized exchanges responsible for customer checks, transaction monitoring, and anti-money-laundering controls. Exchanges may struggle to collect the information expected by regulators when transaction details are hidden at the protocol level.
Europe is making that conflict more direct. The European Union’s Anti-Money Laundering Regulation addresses crypto accounts that allow transactions to be anonymized or made harder to trace, including through “anonymity-enhancing coins.”
The regulation is scheduled to apply from July 2027. Its provisions will prevent crypto-asset service providers from maintaining anonymous accounts or accounts that allow transaction obfuscation through such assets.
The US has not introduced an identical nationwide prohibition on privacy-coin trading. Still, limited support from large exchanges means American users may face fewer options than holders of more widely listed assets. Grayscale’s ZCSH provides regulated price exposure to Zcash, but owning an ETF share is not the same as holding $ZEC or using its privacy features on-chain.
THORChain targets the missing bridge between privacy coins and crypto
A blockchain can remain permissionless at the protocol level while becoming difficult to use in practice.
Someone may still receive and send $XMR through the Monero network. The larger problem appears when that person wants to move from $XMR into Bitcoin, Ethereum, or a stablecoin without using a centralized service that supports both sides of the trade.
Native cross-chain liquidity offers another route. THORChain is designed to exchange assets across their original blockchains instead of requiring users to move wrapped representations onto a separate network.
Under the planned privacy-coin integrations, users would be able to move between native $XMR or $ZEC and supported crypto assets without first depositing their funds with a centralized exchange. They would not need to create an exchange account or surrender custody for the trade.
THORChain had already tested native Monero swaps before v3.20. As crypto.news reported in June, the protocol said $XMR swaps were working from end to end in testing and that Zcash support would follow.
The delay announced after v3.20 shows that technical preparation does not guarantee immediate public availability. Cross-chain systems must manage separate networks, liquidity pools, and security risks, while privacy-focused assets can add further operational and regulatory questions.
THORChain said the delayed rollout would give contributors more time to prepare the Monero and Zcash integrations. Native swaps can reduce reliance on centralized intermediaries, although users must still consider liquidity, network, and implementation risks.
Zcash exposes the market’s privacy contradiction
Zcash makes the split between regulated investment access and on-chain privacy even clearer.
Unlike Monero, Zcash allows users to choose between transparent and shielded transactions. According to the project’s documentation, transparent addresses expose transaction information publicly, while shielded addresses are designed to protect financial details.
Grayscale’s ETF does not give investors access to either transaction type. ZCSH holds $ZEC to track the asset’s market value, while investors buy and sell fund shares through a securities exchange.
The product therefore brings the economics of a privacy coin into a regulated US investment structure without giving shareholders its underlying privacy functions. Grayscale’s earlier filings also indicated that the fund would use transparent custody rather than shielded addresses.
For investors, that distinction matters. ZCSH offers price exposure and brokerage convenience, not private payments or direct participation in the Zcash network.
The ETF’s arrival still represents a notable change in how traditional finance treats privacy-focused assets. Crypto.news previously reported that Grayscale’s conversion followed an SEC filing process that began in May. The launch placed $ZEC beside other crypto assets available through regulated US exchange-traded products.
At the same time, exchange delistings show that regulatory acceptance is not uniform. Authorities and financial firms may permit a transparent investment vehicle tied to a privacy coin while remaining uncomfortable with direct access to its transaction features.
Decentralized access does not remove every trade-off
THORChain’s planned $XMR and $ZEC support sits between those two markets.
Version 3.20 also restored support for Solana, Base, and BNB and introduced Protocol-Owned Liquidity and a Stable Reserve. Yet the privacy-coin integrations are more revealing because they address an access problem created outside the underlying blockchains.
Centralized exchanges offer customer support, fiat payment channels, and account protections that decentralized protocols may not provide. They also remain responsible for meeting the laws of every jurisdiction in which they operate.
Decentralized systems remove some of those intermediaries, but they place more responsibility on users. A person making a native swap must manage a compatible wallet, verify addresses, and understand that transactions may not be reversible. Liquidity and execution prices can also differ from those available on a large exchange.
Regulatory questions will remain even if the protocol itself does not require an account. Users are still responsible for following the laws, reporting rules, and tax requirements that apply in their country.
None of those limits change the central issue. A cryptocurrency is only partly accessible when its network remains online, but the main routes connecting it to the wider market disappear.
Privacy coins are now testing the meaning of permissionless finance. If regulated exchanges decide they cannot support certain assets, access will either continue to shrink or decentralized infrastructure will provide another path. THORChain is preparing to offer that path, although its Monero and Zcash swaps must first move from technical groundwork to a stable public rollout.
