a16z Crypto Outlines Privacy Trends for 2026

Author | a16z crypto

Compilation | Odaily Planet Daily (@OdailyChina)

Translator | Dingdang (@XiaMiPP)

Editor's Note: In 2025, Zcash's surge reignited the privacy narrative within the crypto industry. More often than not, what we see is just a rising emotional fervor and an influx of capital. Many people may secretly believe this is merely a temporary emotional wave, lacking a genuine recognition of the narrative's long-term sustainability. The latest report from a16z Crypto, "Privacy Trends for 2026," aims to bring the issue of privacy back into the spotlight.Infrastructure and Long-Term Evolution Logicwithin the discussion framework. By aggregating the collective insights of multiple seasoned professionals in the crypto industry, the article elaborates on their perspectives regarding "how privacy will shape the next phase of the cryptographic ecosystem," covering multiple aspects ranging from decentralized communication and data access control to methodologies in secure engineering.

1. Privacy will become the most important "moat" in the crypto industry this year.

Privacy is one of the key features for the global financial system to move onto the blockchain; yet, it is also one of the most severely lacking features in almost all blockchains today. For most chains, privacy has long been an afterthought, added as an after-the-fact patch. However, nowadays, privacy alone is already sufficient to create a meaningful distinction between one chain and all others.

Privacy also brings a more important point: chain-level lock-in effects—also known as "privacy network effects" if you prefer. This is especially true in the case of aRelying solely on performance competition is no longer sufficient to win.'s world.

Thanks to cross-chain bridge protocols, as long as all data is public, migrating between different chains is almost cost-free. However, once privacy is involved, the situation is entirely different:Transferring tokens across chains is easy, but transferring "secrets" across chains is extremely difficult.There is always a risk of identity inference through on-chain data, the mempool, or network traffic when activities occur outside the privacy zone. Whether switching from a privacy chain to a public chain or between two privacy chains, a significant amount of metadata is exposed, such as transaction timing and size correlations, which can make users more easily traceable.

Compared to new public blockchains that lack differentiation and whose transaction fees are likely to be driven down to near zero in competition (as blockchain space has become largely homogenized in nature), blockchains with privacy capabilities can generate stronger network effects. The reality is:If a "general-purpose" blockchain lacks a thriving ecosystem, killer applications, or asymmetric distribution advantages, there is hardly any reason for users to adopt it, let alone build upon it and maintain loyalty.

In a public blockchain environment, users can easily interact with users on other chains—joining a specific chain is not a major concern. However, in a private blockchain, users' choices become critical, as once they join a certain private chain, they are less willing to migrate and risk exposing their identities. This mechanism can lead to the formation of a kind ofA winner-takes-all (or at least the winner takes the majority) pattern.And since privacy is essential for most real-world application scenarios, ultimately,A few privacy chains may control the majority of value activity in the crypto world.

—— Ali Yahya@alive_ethPartner at a16z Crypto

2. This year, the key issue for instant messaging applications is not only quantum resistance, but more importantly, decentralization.

As the world gradually prepares for the era of quantum computing, many instant messaging apps built on cryptographic technologies—such as Apple, Signal, and WhatsApp—have taken the lead and are performing quite impressively. But the problem is that,All major communication tools still rely on private servers operated by a single organization.And these servers are precisely the targets where the government can most easily shut them down, implant backdoors, or force them to hand over private data.

If a country can directly shut down servers; if an enterprise holds the private keys to private servers; or even simply because an enterprise owns the private servers—then what is the significance of even the strongest quantum encryption?

A private server essentially asks users to "trust me," whereas having no private server means "you don't need to trust me." Communication does not require a single company positioned in the middle. What messaging systems need are open protocols, allowing us to communicate without having to trust anyone.

The way to achieve this goal is to fully decentralize the network:No private servers, no single application, fully open-source code, and employing first-rate encryption technologies—including quantum-resistant encryption.In an open network, no individual, company, non-profit organization, or nation can deprive us of our ability to communicate. Even if a country or company shuts down an application, 500 new versions will emerge the very next day. Even if one node is closed, new nodes will immediately appear to replace it—mechanisms like blockchain provide clear economic incentives for this.

Everything will change when people can control their messages as they control their funds—via private keys. Applications may come and go, but users will always maintain control over their messages and identities; even if they no longer possess the application itself.End users can still have their own messages.

This has gone beyond the scope of "quantum resistance" and "encryption," and is instead aboutOwnership and DecentralizationWithout any one of these parties, what we build would merely be an "unbreakable yet still shut-downable with a single click" encryption system.

—— Shane Mac@ShaneMacCo-founder and CEO of XMTP Labs

3. "Secrets-as-a-Service" will become the core infrastructure for privacy.

Behind every model, agent, and automated system lies a fundamental dependency: data. However, most data pipelines today—whether the data input into models or the data output by them—are opaque, mutable, and non-auditable.

This may be acceptable in some consumer applications, but in industries such as finance and healthcare, users and institutions often have strong privacy requirements. This issue is also becoming a major obstacle in the current efforts of institutions to tokenize real-world assets.

Then, how can we achieve secure, compliant, and autonomous innovation with global interoperability while protecting privacy?

There are many possible solutions, but I would like to focus on the most important ones.Data Access ControlWho controls the sensitive data? How does the data flow? And who (or which systems) can access this data under what conditions?

In the absence of data access control, any entity wishing to maintain data confidentiality currently has only two options: relying on centralized services or building customized systems themselves. This is not only time-consuming and expensive, but also severely hinders entities such as traditional financial institutions from fully realizing the potential of on-chain data management. As autonomous agent systems capable of independent behavior begin to browse, trade, and make decisions on their own, cross-industry users and institutions will needDeterministic Assurance of Encryption Levels, rather than "trust based on doing one's best."

This is exactly why I think we need "secrets-as-a-service":A novel technical framework that provides programmable, native data access policies; client-side encryption; and a decentralized key management mechanism, enforcing on-chain the rule of "who can decrypt which data, under what conditions, and for how long."

When these mechanisms are combined with verifiable data systems, "secrets" themselves can become part of the fundamental public infrastructure of the internet, rather than being patched on as an afterthought at the application layer—truly enabling privacy to become foundational.Underlying infrastructure.

—— Adeniyi Abiodun (@EmanAbioCo-founder and Chief Product Officer at Mysten Labs

4. Security testing will evolve from "Code is Law" to "Standards are Law."

Last year's multiple DeFi hacking incidents targeted not new projects, but rather protocols with mature teams, multiple rounds of audits, and years of operation. These incidents highlight an unsettling reality:Current mainstream security practices still heavily rely on rules of thumb and case-by-case judgment.

To achieve true maturity this year, DeFi security must shift from "vulnerability pattern recognition" to "property guarantees at the design level," and move from a "best-effort" approach to a "principled methodology":

In the static/pre-deployment phase (testing, auditing, formal verification), this means that instead of merely verifying a small set of selected local properties, properties are systematically proven.Global invariantsCurrently, multiple teams are building AI-assisted proof tools that can help write specifications, propose invariant hypotheses, and take over the labor-intensive proof engineering work that was previously extremely costly in terms of human effort.
In the dynamic/post-deployment phase (runtime monitoring, runtime constraints, etc.), these invariants can be transformed intoReal-time barrier, becoming the last line of defense. These guardrails will be directly encoded as runtime assertions, requiring every transaction to satisfy them.

In this way, we no longer assume that "all vulnerabilities have already been discovered," but instead enforce critical security properties at the code level, and any transaction that violates these properties will be automatically rolled back.

This is not just theoretical. In fact, almost all attacks carried out so far have triggered at least one of these checks during execution, potentially halting the attack directly. Therefore, the once-popular notion of "code is law" is evolving into "specifications are law": even entirely new attack methods must satisfy the security properties necessary to maintain system integrity, and the ultimately feasible attack space will be compressed to a very small or extremely difficult-to-execute level.

—— Daejun Park (@daejunpark), a16z engineering team