The privacy coin market saw a significant shift in leadership as Monero (XMR) reclaimed its position as the most valuable coin in the segment, capitalizing on a sharp downturn for its rival Zcash (ZEC). The change follows a deeper correction for ZEC after its core developer team, the Electric Coin Company (ECC), abandoned the project due to governance disputes.
Monero flipped Zcash with a price of $456.39, achieving a total market capitalization of $8.42 billion. In contrast, ZEC sank to a local low of $395.85, a volatile swing that left its market cap at $7.14 billion, more than $1 billion behind XMR. ZEC showed short-term recovery signs, regaining nearly 10% to $434.13, but remains significantly devalued.
The catalyst for ZEC's decline was the reputational damage from the developer exit, which sparked heavy liquidity outflows. Despite the downturn, there are no signs of panic withdrawals from ZEC's high-security Orchard pool, which still holds over 4.87 million staked ZEC. The ECC has not completely abandoned the project, announcing the formation of a new wallet and privacy company expected to support ZCash. Miners continue supporting the network, with the hashrate expanding to a new all-time high.
Monero's rally of over 6% on Thursday, jumping from $430 to $464, occurred while the overall crypto market cap was down 1.3%. Analysts suggest XMR may have absorbed some of the liquidity fleeing Zcash. Monero's spot demand has been building, with daily inflows signaling rising interest in the privacy narrative, especially as tax authorities increase scrutiny on wallets.
Despite its leadership, Monero faces challenges. It remains banned from most major exchanges like Binance and Coinbase, limiting mainstream access and potentially capping its upside. XMR holders are promoting a store-of-value narrative, even as the coin is avoided by US and EU operators due to money laundering concerns. Unlike ZEC, Monero has not ventured into the DeFi space or offered tokenized versions.
Looking ahead, Monero's price action has been on an overall uptrend since 2023. With Zcash seemingly out of the way, healthy momentum could push XMR to the $600-$700 range in the coming months, with a potential target of $1,000 by 2027. However, it may face competition from privacy-focused alternatives like Cardano's Midnight and Litecoin, which are available on mainstream exchanges.
