**Changpeng Zhao (CZ)** and **Chamath Palihapitiya** pointed out in a 2-hour All-In podcast episode that privacy is the most important unresolved issue in cryptocurrency.
There is one fact that neither the podcast nor the Phemex article that reported this statement mentioned. It is that the fund co-founded by CZ executed an 8-digit investment in a trading platform focused on privacy just a few weeks ago.
What they said
Zhao argued that Bitcoin's transparent ledger structure creates real-world risks when the number of users increases significantly.
He also provided specific examples. If someone books a hotel and their address becomes publicly traceable on-chain, that immediately becomes a security issue.
Palihapitiya went a step further, stating that traceable transactions destroy the fungibility of Bitcoin (BTC) since all coins carry historical records.
He explained this as the reason he remains skeptical about Bitcoin maximalism. If all transactions are publicly recorded, cryptocurrency cannot function like digital cash.
The two pointed out that the moment the exchange applies KYC requirements, anonymity effectively disappears, and real-name information is directly linked to blockchain activities.
The conclusion they shared was clear. Without protocol-level privacy, cryptocurrency use will not expand to everyday payments and will remain limited to speculation and settlement purposes.
Financial context
On January 13, after CZ left **Binance**, the family office YZi Labs, co-founded with **Yi He**, announced a multi-8-figure investment in Genius Trading, a privacy-focused decentralized trading platform. CZ also took on an advisory role at Genius.
Genius employs multi-party computation to distribute orders across hundreds of wallets, particularly reducing the on-chain traceability of large orders.
This platform has already processed over $60 million in trading volume during its beta phase, and plans to launch a public privacy protocol in Q2 2026.
YZi Labs manages approximately $10 billion in assets globally. Investments in Genius were not mentioned in the podcast or most articles covering CZ's privacy statements.
Also read: PEPE Volume Explodes 283%: Memecoin Rally Ignites February 2026
Why it matters
The arguments surrounding privacy are technically valid.
The transparent design of Bitcoin actually creates surveillance risks, and on-chain analysts routinely track whale wallet movements, exchange deposits and withdrawals, and wallet balances. This media outlet also reports such matters daily.
However, if a person with an eight-digit monetary interest in privacy infrastructure advocates for privacy as the top priority for cryptocurrency in public, that background becomes crucial information for evaluating that claim.
CZ is not an uninterested observer on this topic. The debate around privacy itself is not new.
Projects like Monero (XMR) and Zcash (ZEC) and various implementations of Zero-Knowledge Proof have existed for years, and regulators have consistently pushed back against privacy features, viewing them as aiding illegal funding.
The question of whether protocol-level privacy and regulatory compliance can coexist remains open, and no one in this conversation seriously addressed the issue.
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