Crypto is in a long night. It is no secret that the industry is facing challenging circumstances and there has been a clear consolidation of the industry. Right now we are seeing a focus on real traction, demonstrable value projects shipping practical solutions that will meaningfully reach users.
Some of that discipline is overdue. However, in times like these the properties that made crypto structurally different begin to look expendable. Decentralization slows you down. It makes upgrades harder. It makes institutional sales harder. It removes the control surfaces that the existing financial world knows how to buy.
We used to accept those costs as the price of building something durable. But, in a famine, they look like unaffordable affectations. Discarding them wholesale, however, is like selling the land out from under our feet.
Permissionless, uncensorable transaction networks with rich composability - this is the clay from which our industry was grown. The long term commercial health of our industry depends on preserving these properties in an age of privacy and institutional adoption.
These trade-offs become more challenging and pernicious when privacy is involved. Privacy is the narrative for crypto in 2026, and for good reason. It’s the missing piece that will deliver the traction and real use-cases that the industry so desperately needs.
The challenges of decentralization multiply under the constraints of privacy and what we are seeing in the industry is not a pivot, but a complete capitulation of all of the differentiable value that made crypto valuable.
I have spent nearly a decade building a network that marries programmable privacy with decentralization. A network where users keep their data, where applications are composable with one another, where transactions can settle without a privileged party learning everyone’s business or deciding which products are allowed to exist. That required new cryptography, new programming models, new state architecture, new wallets, and a fairly insane number of tradeoffs that are invisible until you try to build the thing yourself. There are easier products to ship.
A centralized privacy service can give institutions something legible quickly, replicating how the existing financial sector works: a responsible operator, a viewing key, a way to block transactions, a way to explain the whole thing to a risk committee. Some of these products will be useful. Some will be good businesses. But they are not the thing we came here to build.
The Devil’s Bargain
Institutional and enterprise adoption is one of the core growth areas in this crypto-winter and the playbook is simple: use the language of crypto as a skin-suit to sell products and services that pattern match onto existing financial rails, with their need for complete visibility, censorship, centralized network operators and all of the liabilities this incurs.
This is a tempting bargain because it shortens the path to adoption. It gives buyers and regulators a shape they understand. A company. A contract. A switch. But the moment you accept that bargain, the system changes character. It may still be encrypted. It may still contain proofs. It may still call itself private. But, it now behaves like and is an operated service.
There is a party with privileged knowledge and privileged control. Builders must shape themselves around it. Institutions negotiate with it. Regulators may pressure it. Attackers target it. Users ultimately depend on it. By a backdoor I mean something specific: a network or protocol-level viewing key where the product developer does not control who can see their users’ data, especially when paired with network-level controls that can block transactions or ban smart contracts entirely. I do not mean application-level controls. I do not mean user-authorised disclosure. I do not mean a dapp deciding that users must prove something before using it. Regulated applications will need rules. The issue is that the disclosure boundary of your application belongs to somebody else, and the same layer that sees can also decide whether your users are allowed to transact. In short, users lack a platform that has credible neutrality.
The Platform Risk
Privacy on top of centralized rails is fatal. If one party can see everything and stop anything, that party may be treated as responsible for seeing and stopping.
This compounds into substantial platform risk. If an entity builds on top of such a system they must surrender visibility and control to the network operator to satisfy their liabilities without consideration for yours. Decentralization and ultimately credible neutrality is the difference between whether you own durable infrastructure or are renting a service whose rules can change on a whim. Worse, you cannot “just build things”. For novel transaction flows approval must be sought and granted. Tell me, would Ethereum have grown if every smart contract deployment required approval from the Ethereum Foundation?
Privacy needs the same freedom. A private credit market, for example, touches identity, collateral, repayment history, payment flows, liquidation logic, lender disclosures, auditor access and borrower privacy. If every component lives inside a different permissioned service, each with its own operator and viewing assumptions, that is a bureaucratic friction that negates blockchain’s core value proposition; composability.
A decentralized and credibly neutral privacy network prevents the settlement layer from becoming the single place where all surveillance and censorship obligations naturally accumulate. It allows product developers to scope their code to satisfy their own narrow requirements without consideration for the obligations of a centralized operator.
Building for credible neutrality
A lot of today’s privacy narrative treats architecture as if it were a detail. It is not. You cannot take a transparent ledger, staple confidentiality onto the edge, add a viewing key for comfort, and expect to get programmable private infrastructure.
If the state model is not private from the ground up you get wrappers, third party tools, data custodians, ad hoc disclosure paths and a pile of assumptions that every application drags into the next. Developers do not get a normal programming model where private contracts can call private contracts and users keep state on their own devices. They do not get composability.
The difference matters. In a real private execution environment, users generate transactions locally. They do not outsource their intent to a third party who learns what they are doing. Private contracts interact through a state model designed for privacy. The network settles proofs without becoming the party that knows everyone’s business. Privacy is part of the architecture.
This is why Aztec has taken so long. We built something that makes programmable private state and decentralised settlement live inside the same system. That means proving systems that run on consumer hardware, a transaction architecture built around local private execution, and a programming model where privacy is idiomatic and just works out of the box.
A centralized service can skip much of this. It can hold the key, run the prover, approve the flow and call the result privacy. It gets to market faster because it is not trying to arrive at the same place.
The edge
Adding decentralization does not make obligations disappear. Applications, issuers, frontends, custodians and regulated businesses will continue to exist in a web of obligations and responsibilities. Anyone pretending otherwise is unserious.
The question is where those obligations live. If they are pushed into the settlement layer, the settlement layer is no longer credibly neutral. It needs visibility into everyone and controls over everyone.
The better answer is selective disclosure. Users and applications should prove specific facts to specific parties for specific purposes. A regulated application may need to know that a user passed a check, that a transaction satisfies a policy, or that an auditor can inspect a particular flow. None of that requires the base network to hold a permanent key into everyone’s activity.
This will be harder to explain to the existing world. New infrastructure always fails to fit the categories built for the old infrastructure. Bitcoin did not arrive as a neatly regulated bank product. Ethereum did not wait for every lawyer to understand smart contracts. Stablecoins and DeFi forced institutions, regulators and users to develop new language around rails that kept existing.
If the standard for privacy infrastructure is to plug into the old world without changing anything, the answer will always be a service with a backdoor. And the result will be to catch crumbs falling from the tables of the old world.
The market worth building
The market we should be building is, well, a market. A private financial system that compounds: assets, liquidity, identity, credentials, credit and applications interacting through a shared settlement layer without forcing users to surrender their data to whoever sits in the middle.
Traditional finance is built out of vertically integrated information silos. Those silos are its moat. Banks, exchanges, custodians, payment processors and data brokers all benefit from controlling the information that flows through them. A global private settlement layer attacks that advantage directly. It lets liquidity and credentials move while outsourcing information custody to neutral cryptographic infrastructure.
A company wants a moat. A settlement layer wants surface area. A permissioned privacy provider can ration access, raise fees, exclude applications, shape disclosure rules and define acceptable use around its own risk tolerance. These are products pretending to be networks, and not durable financial infrastructure. What bothers me is this compounding category confusion. Networks adding protocol-level viewing keys and transaction controls are using the same language as decentralised programmable privacy, and commentators are treating them as variations of the same thing. They are not.
We have spent nine years walking the hard road. Now, just as we are close, the market has lost faith. Everyone is reaching for whatever lifeline looks immediate. Some of those lifelines will be real. Some will make money. But if crypto responds to its long night by rebuilding financial privacy as permissioned services, then we will have survived by surrendering the property that made the industry worth building.
Markets can grow when the platform is removed from the position where it can dictate the rules. It would be perverse to forget that lesson while building privacy, the domain where control over information matters most.
The land we till
Crypto is in a famine. The land is struggling. We could sell our land for a pittance and survive the season. But the famine will pass, and when it does the land will blossom again. Without the land we are nothing.
We have struggled immensely to create a permissionless network that can marry privacy with decentralisation: an indestructible network whose users cannot be surveilled and whose transactions cannot be censored. This is the soil we have to grow our crops. To surrender a backdoor or a centralized operator for temporary relief is to sell our land for the price of a stablecoin. And we cannot sell the land.
Follow Zac on X to get more insights
Follow Aztec on X for updates & breaking news











