TL;DR

• Interest in crypto privacy is re-emerging as a key trend in 2025, driven by regulation and institutional demand.
• Zcash uses optional shielded transactions via zk-SNARKs, but the majority of its usage remains in transparent mode-undermining its privacy promise.
• COTI embraces a fundamentally different architecture: the use of Garbled Circuits enables private smart contracts, multiparty confidential logic and programmable privacy rather than simple private transfers.
• Performance benchmarking shows COTI's solution operates much faster and lighter than many competing privacy frameworks, making real-world scalability more feasible.
• COTI supports compliance and auditability alongside privacy-an important factor as regulators scrutinize privacy-coins and infrastructure.
• In short: Zcash pioneered private transactions; COTI aims to replace that paradigm with private programmable logic at scale, positioning itself for the next generation of privacy-enabled finance.

In 2025, privacy is no longer an esoteric niche in crypto-it's returning to the centre of attention. Google searches related to "crypto privacy" have surged throughout 2025, reflecting renewed public interest in how personal financial data is stored, shared, and secured on-chain. Even major venture firms are taking note. In its State of Crypto 2025 report, a16zcrypto highlighted privacy as a critical "signal" shaping the next phase of blockchain adoption. The reasoning is clear: as the industry matures, transparency without confidentiality has proven incomplete.

For years, most projects prioritized scalability, speed, and composability. But as real-world use cases expand - from institutional payments to AI-driven transactions - the lack of built-in privacy is becoming a structural limitation. Financial data is inherently sensitive, and open ledgers expose more than just wallet balances. They reveal behavioral patterns, counterparties, and transaction histories - all of which can be analyzed or exploited.

The renewed push for privacy isn't about hiding activity; it's about restoring user control and data sovereignty. As Web3 applications merge with traditional finance and machine learning systems, that control becomes not just desirable, but essential.

Zcash's Privacy Approach: Strengths & Limits

Zcash remains one of the earliest and most influential privacy coins - a pioneer in zero-knowledge cryptography that allowed users to shield transactions from public view. Its zk-SNARKs technology set a foundation for what would later become a core pillar of privacy infrastructure across the blockchain ecosystem.

But while Zcash's architecture was groundbreaking, academic research has shown that theory and practice don't always align perfectly. A 2018 study by Kappos et al revealed weaknesses in the coin's anonymity model. By analyzing patterns of coins moving in and out of Zcash's shielded pools, the researchers demonstrated that users could often be linked through heuristic analysis - meaning privacy wasn't absolute.

Another study found that many coins entering Zcash's shielded pool were later sent back to transparent addresses, effectively re-exposing transaction details and weakening overall anonymity. This highlights a behavioral gap: the technology allows privacy, but user habits and economic incentives often work against it.

Zcash established an early model of private transactions; but times have now moved on, and the requirements have shifted. Privacy today means not only hidden transfers, but hidden logic, hidden state, even hidden business rules-yet still verifiable, auditable and scalable. In short, Zcash's privacy is optional-and that optionality matters. Most usage remains transparent for ease, cost, or regulatory reasons. That means the privacy guarantee weakens in practice. Moreover, the limited throughput (~3-12 TPS) and usage of shielded mode make it harder to use Zcash as a basis for large multi-step logic or enterprise flows. That is what leads us to compare Zcash and COTI, and why COTI may be the next step in the privacy chain.

COTI's Architecture: Programmable, Private, Scalable

Enter COTI. Rather than simply hiding transfers, COTI uses a different cryptographic foundation-Garbled Circuits (GC)-to support private computation, multiparty logic and hidden state. According to benchmarking: 

What does this mean in practice?

Confidential Smart Contracts: Logic can run on encrypted inputs, state and outputs. Developers don't need to build completely new languages.
EVM Compatibility: COTI V2 maintains compatibility with Solidity and existing tooling, making migration smoother.
Scalability & Performance: According to benchmarks, GC-based privacy on COTI reduces storage overhead and speeds up computation compared to earlier privacy models.
Compliance & Auditability Built-in: Privacy is not at odds with audit-they designed for selective disclosure, traceability, but only when permitted.

In other words, COTI isn't just a "privacy coin"; it's a privacy layer, built for programmable logic, enterprise use, and hybrid transparency.

Core Differences Between Zcash & COTI

Let's look at the key dimensions of difference:

• Privacy Tech: Zcash uses zk-SNARKs for transfers; COTI uses Garbled Circuits, enabling logic privacy and multiparty computing.
• Scope: Zcash focuses on private transfers; COTI extends privacy to DeFi, smart contracts, real-world assets (RWAs), DAOs.
• Throughput: Zcash limited in TPS due to privacy overhead; COTI claims higher throughput and lower overhead.
• Compliance Design: Zcash allows optional shielding; COTI aims for programmable transparency, making it easier to align with regulation.
• Interoperability: Zcash is relatively siloed; COTI emphasises cross-chain interoperability and Layer 2 integration.

So while Zcash pioneered the notion of privacy in crypto, COTI aims to replace that paradigm by offering a more versatile, scalable, regulated and programmable privacy infrastructure.

Why COTI Is Likely to Flip the Game

a) Real-World Use-Cases Demand More Than Private Transfers
Enterprises and institutions don't just need private transactions-they need private workflows. For example: a bank wants to settle off-chain data, make tokenised asset flows, run confidential governance votes, all while maintaining audit trails. COTI's privacy layer supports exactly that.

b) Regulation & Compliance Become Front-and-Centre
Given the regulatory pressures on anonymity-enhanced cryptocurrencies, projects that support selective disclosure and auditability have an edge. COTI's architecture aligns with this. Zcash's optional shielded mode may hinder adoption in regulated environments.

c) Scalability & Performance Matter for Mass Adoption
Privacy features are good, but unusable if slow or expensive. COTI's benchmarking results suggest that Garbled Circuits can deliver performance suitable for real-time applications-this matters for DeFi, tokenised assets and enterprise flows. COTI's performance benchmarking: 

d) Developer Ecosystem & Interoperability
COTI emphasises compatibility with existing smart-contract tooling and cross-chain capability. Projects that choose privacy infrastructure today must consider migration path, developer ecosystem and real-world integrations.

e) Programmable Privacy Is the Next Frontier
The shift is from "hide everything" to "control what you reveal and when." COTI's model fits that shift. Zcash's model remains essentially "all or nothing" privacy for transfers, which limits flexibility for complex dApps or institutional infrastructure.

Challenges and Considerations

No article would be complete without acknowledging risks. Some of the challenges for COTI include:

• Developer adoption: Privacy-smart contract tools are still new; building the ecosystem takes time.
• Competition: Other privacy solutions (ZK, FHE, trusted execution) are evolving and could narrow the gap.
• Network effect: Zcash has brand presence; COTI must scale its ecosystem.
• Regulation still evolving: Even compliant privacy layers must adapt to changing oversight.

Performance is promising, but real-world load, cross-chain complexity and decentralisation must be proven at scale.

Final Thought

Zcash has played a vital role in crypto's privacy journey. But the world has moved from "simple transfers" to "private logic, private state, private programmes". COTI is positioned at that next inflection point. By marrying Garbled Circuits with developer-friendly execution, enterprise readiness and regulatory alignment, COTI may not simply compete with Zcash-it may replace the paradigm that Zcash introduced, making privacy programmable, scalable and fit for mass adoption. 

As we move into a future where private, on-chain workflows become standard, the infrastructure winners will be those that deliver confidentiality and compatibility. On that stage, COTI could well take the lead.