Privacy coins have become one of the dominant narratives shaping cryptocurrency investment trends this year. The two leading altcoins in this segment, measured by volume and market capitalization, are Zcash (ZEC) and Monero (XMR).
Investor attention has been strongly focused on ZEC. In the meantime, XMR continues to show solid and steady growth.
XMR performs better than ZEC in several areas even without much attention
When it comes to daily spot trading volume in December, ZEC performed exceptionally well.
According to CoinGecko, ZEC has a daily trading volume of nearly $1 billion. This level surpasses XMR and DASH, thanks to high liquidity on major exchanges like Binance.
However, ZEC remains far behind in terms of daily on-chain transactions. Data from BitInfoCharts shows that XMR averages around 26,000 transactions per day. This number is more than three times ZEC's average of about 8,000 transactions each day.
The graph also shows that XMR's on-chain activity remains stable over time. This trend reflects a stable user pattern. In contrast, ZEC's recent increase and sudden decline appear more like a temporary hype.
On-chain activity has greater long-term significance than spot volume. It actually reflects the use and acceptance of XMR for anonymous transfers, rather than short-term trading sentiment.
Additionally, ZEC's price fluctuates due to increased volatility caused by speculative trading. The price movements of XMR remain more stable.
Data from TradingView shows that ZEC has fallen by over 40% in the last month. Many analysts now suggest the possibility of a bubble pattern. Meanwhile, XMR has fallen by about 12%.
From this perspective, ZEC is best suited for traders seeking the privacy coin narrative and wanting quick gains during extreme FOMO cycles. The downside is deeper price drops and a longer period for recovery.
Furthermore, the latest report from MEXC Research strengthens XMR's position. Over longer time horizons, XMR shows superior trading volume and user activity compared to both ZEC and DASH.
“Despite ZEC and DASH having record-high trading volume, Monero remains the preferred asset among traders in privacy coins, accounting for 93% of the total trading volume in Q3–Q4 and 72% of the users in this segment,” reports MEXC Research.
The report also notes that increased interest in privacy coins reflects users' growing need for anonymity as regulators tighten capital controls.
Thus, investors, whether they hold ZEC or XMR, can still benefit next year. Experts predict that privacy coins will remain a dominant market theme even in 2026.
