Recently, I purchased several projects with a 5x increase in the secondary market, such as $hype and $blue. I kept buying as the price rose, resulting in significant profits.
This made me realize that the altcoin season may arrive soon.
From the altcoin season indicators, in the past 90 days, 67% of the top 50 tokens outperformed Bitcoin. If the proportion reaches 75%, it means the crypto circle has officially entered the altcoin season.
From the curve, between December 1 and 8, the market made its first attempt. After a drop on December 9, the market entered a correction phase. Currently, the market is gathering strength and is expected to complete the adjustment soon, followed by the altcoin explosion season.
At this time, we should be well-prepared: investigate in advance, position at low points, and then wait for the wind to come.
Among altcoins, apart from DeFi, privacy projects are the most favored by capital and large holders. This track has been quietly rising, to the extent that many people are completely unaware of its existence. For instance, Zcash has already risen by 56% in the past 30 days.
Today, let's talk about why we should focus on the privacy track. This article introduces several aspects:
Why is there a privacy track?
Comparison of 10 Privacy Projects
What innovations does Mystiko have?
What opportunities are there in Mystiko?
I. Why is there a privacy track?
On-chain transparency of blockchain is a double-edged sword; users' on-chain transaction activities, balances, etc., are transparent. Although the true entities behind on-chain accounts are anonymous, their account transaction data is almost completely transparent. If your on-chain address happens to interact with platforms like CEX that require KYC, it means that all your on-chain assets are exposed. Even using DEXs like Uniswap, the same exposure occurs.
Web3 is highly related to assets, and on-chain transparency poses a significant problem. If intended, people can easily track these transactions. A typical case is:
3AC had previously confidently disclosed some addresses to prove their high strength in the crypto circle.
However, unfortunately, they encountered the LUNA incident. During the LUNA incident, some individuals tracked the 3AC address, resulting in a massive influx of reverse operations that accelerated the liquidation of 3AC.
In addition, there was the FTX incident, which exacerbated distrust in CEX. To rebuild market confidence, CEX must disclose their assets more transparently than before, but many users and institutions do not want their account balances to be public.
At this time, the market needs privacy projects, whether it's hiding addresses or concealing transactions, as long as they don't 'run naked' on-chain.
So when Monero and ZCash first emerged, they gained favor from VCs, miners, and large holders. It wasn't until later, after Tornado Cash was banned, that people truly realized the market needed more privacy projects to provide services.
Currently, the solutions on the market use zk-SNARKs to improve the privacy of encrypted assets, storing users' balances in Merkle trees or KZG commitments. This not only protects users' privacy but also effectively discloses users' asset statuses. The encrypted assets utilizing this solution are referred to as 'privacy tokens'. Since 2013, such privacy tokens have included:
Zcash (ZEC)
Verge (XVG)
Monero (XMR)
Dash (DASH)
Beam (BEAM)
Horizen (ZEN)
Bytecoin (BCN)
In the coin circle, there is a principle of investing in new projects rather than old ones. Finding new projects or those that haven't surged can improve investors' win rates. Therefore, this article will not analyze those old privacy projects; instead, we have compared ten representative projects.
II. Comparison of Ten Privacy Projects
Privacy projects are primarily created to meet users' demand for anonymity, generally used to protect data, addresses, transaction records, amounts, or files. The privacy concept was first introduced by Monero, and during the 10 years since the launch of $xmr, the token has increased by 8601%, creating vast wealth for countless miners.
Inspired by Monero, developers have tried various methods to develop privacy coins over the past ten years. One of the more famous ones is Zcash, which uses ZKP technology to hide transaction addresses, thereby concealing the sender and receiver of funds, protecting user privacy. In 2020, it was decided to allocate 20% of the mining rewards from the ZEC network to the ZCash Foundation for the operation of the project. However, some participants were dissatisfied with this, leading them to create a fork chain, ZCL.
The discord in the Zcash community has brought significant opportunities to the privacy sector. After developers left, many projects were created, with some representative ones being:
Currently, most solutions use ZKP technology to encrypt users' transaction information to protect user privacy.
In the past 30 days, the privacy sector has generally risen by 50%, with $mask and $xzk increasing by 35%. $mask is related to social privacy; this article mainly discusses infrastructure projects, so we focus on Mystiko.
III. What innovations does Mystiko have?
Among many privacy projects, Tornado Cash was widely used globally until it was banned in August 2022.
The Tornado Cash mechanism is very simple; it uses a mixer model, allowing users to deposit ETH, DAI, USDC, and other ERC-20 tokens, and withdraw them from different other crypto addresses. Technically, it uses ZK technology to encrypt the depositors' wallet addresses and mixes them with other users' wallet addresses who deposited the same token, making it difficult for outsiders to track the flow of funds.
Since Tornado Cash is deployed on Ethereum, BSC, Polygon, and Optimism Network, meeting most EVM address needs, it resembles the cross-chain privacy model. However, it has the drawback of high gas fees. Even so, before the sanctions, Tornado Cash had already processed approximately $8 billion in transactions, indicating a substantial market demand for cross-chain privacy.
(I) Mystiko Background
With strong market demand, Mystiko Network has launched the Mystiko Protocol based on zk-snarks after two years of development, featuring an easily integrated technical protocol that can be incorporated into almost all major cross-chain bridges in the Web3 ecosystem. This makes Mystiko one of the few cross-chain privacy projects available today.
Such an innovative concept and market demand allowed Mystiko Network to secure $30 million in funding led by Sequoia Capital in the private placement round in March 2024, with participation from: Samsung Next, HashKey, Mirana, Signum, Coinlist, Naval Ravikant, Sandeep Nailwal, Gokul Rajaram, Tribe Capital, Morningstar Ventures, and other investors.
Let's take a look at how Mystiko works in detail.
(II) Introduction to Mystiko
Mystiko Network is the zero-knowledge (ZK) technology layer of Web3, providing privacy protocols and ZK software development kits to ensure scalability, compatibility, and permission privacy for projects utilizing Layer 1, Layer 2, wallets, cross-chain, etc.
Ordinary users only need to use Mystiko's one-click wallet to manage and transfer their assets among complex blockchain technologies such as Ethereum, BSC, Polygon, Avalanche, Polkadot, Near, Solana, etc., with only a small gas fee.
Many people might think Mystiko Network is going to create an L1 or L2. It is important to note that Mystiko Network, as a privacy technology provider, is not a Layer 1 or Layer 2 platform and does not belong to any ecosystem. It is a comprehensive privacy technology service; any project that requires user privacy can use Mystiko's SDK toolkit to integrate Mystiko into their protocol, which is the 'plug-and-play' function mentioned earlier.
Projects using Mystiko's privacy SDK tools include Camo Wallet (wallet), Cable (bridge), Ninja (payment), Wizard (DEX).
In addition, it supports cross-chain communication protocols such as LayerZero, Axelar, and Celer, providing toolkits to build fully anonymous cross-chain transfer products.
(III) What products does Mystiko Network have?
The most basic product of Mystiko Network is the Privacy SDK toolkit, which helps chains, bridges, wallets, and dApps integrate privacy with ZK technology.
The first project developed based on this technology is Camo Wallet. Users can store assets, transact, and perform cross-chain transfers completely anonymously in this wallet. Thanks to the ZK-SNARK proof generated by Mystiko for each transaction, Camo Wallet offers high anonymity and security.
In terms of compatibility, users can transfer or withdraw funds using public wallets like Metamask through Camo Wallet.
(IV) What applications does Mystiko Network have?
According to official information, Mystiko products can be applied in the following situations:
Cross-chain transfers: This is the core functionality of Mystiko, allowing users to deposit assets on one chain and withdraw funds from another chain without exposing any transaction details.
MystikoPay: A completely on-chain payment method where no one can see users' payment history. All payment history is confidential, which is particularly useful for companies and merchants to prevent sensitive business revenue details from being exposed on-chain.
Secret Vault: Users can transfer assets to completely secret and extremely secure addresses, with complete privacy. Any wallet can provide such functionality to users by implementing the Mystiko Wallet SDK.
Private DEX: Users can trade on private DEX like on Uniswap while protecting their financial privacy. DEXs can now add such features for users by implementing the Mystiko protocol.
(V) Project Data
From the data, the project supports transactions on 6 unique blockchains with a volume exceeding $272 million: Ethereum, BNB Chain, Polygon, Avalanche, Linea, and Base. It has generated over $5 million in fee revenue for hundreds of ZK-Rollup miners and relayers within the network.
Alright, that's the project information for now. The focus of this article is still below: can we make money?
IV. What opportunities are there in Mystiko?
Mystiko is the benchmark for cross-chain privacy, with a total token supply of 1 billion $XZK, private placement price of $0.09, public offering price of $0.15, and listing price of $0.27.
Current market price $0.03713, nearly three times lower than the private placement price.
FDV of $37.55 million is the smallest market capitalization and the least increased token among the top ten privacy projects. Other privacy projects have issued tokens at least two years ago and have completed at least one cycle of increases. $XZK's TGE was on June 18, and the token price has not exceeded the private placement price since July. After such a long period of accumulation, retail investors have little holding left, and airdrops have all been distributed.
From on-chain data, it seems that large holders have been accumulating in the past week, with their holdings increasing by 0.09%. This may be waiting for favorable market news to emerge, such as token burns or other incentive activities.
Currently ranked around 1100 in market capitalization, the token price is severely undervalued. With the arrival of the altcoin season, the profit potential is huge.
Similar to Chainlink in its early stages, $XZK is also steadily growing under difficult conditions. With strong partnerships and a reliable V2 SDK, it is poised to gain significant value when the market recovers.
Historically, privacy coins like ZCash and XZK have always faced regulatory scrutiny. However, the recent victory of Tornado Cash against OFAC and Trump's cryptocurrency-friendly policies may significantly boost these tokens.
