Shang Yang knows horse power, Bi Gan sees human heart. NIL ascends to heaven, XMR delists.
Blockchain originated from privacy technology, especially cryptography, from elliptic curves to zero-knowledge proofs, all proving the success of privacy economics in the Web 3.0 era.
However, things won't be perfect. From XMR being frequently delisted from CEX/DEX to the arrest of Tornado Cash's founder, you'll find that even if Nillion can list on Binance, the geek spirit of privacy projects is retreating, and their final product delivery capability is far from perfect.
In polishing privacy products, blockchain projects need to learn from Web2 counterparts and improve their posture.
Proton Proves Privacy Can Be a Well-Functioning Product Form
Privacy is a Feature, Not a Product.
Discussing privacy's enhancement of product form lacks meaning. In other words, privacy also needs PMF. Giants like Google and Meta can both infringe on privacy and make people unable to resist, due to convenience and network effects. If it's ready to use and everyone uses it, even in non-office scenarios, people will ultimately accept everything from Google.
In this regard, regulatory bodies' fine-as-management approach is utterly failed. Even with Google's legendary fine of $2.974 billion, Google would probably only need 16 extra days to earn it back. These fines cannot become European tech companies' income, leaving them further powerless against Google.
Facing this issue, Proton's approach is to build a full suite, starting from CERN. Scientific researchers' pure innate credibility is higher than commercial companies'. Cryptographic technology, open-source code, product audits - privacy products built this way truly have real-world significance. You can avoid Google's full suite while still achieving corresponding functions.
Of course, current network and scale effects still cannot compete with giants, but compared to blockchain peers, their products are sufficient for daily use, a qualified Google Alternative.
Compared to Google Workspace, Proton currently mainly focuses on products benchmarked against Proton Mail itself. It's worth mentioning that Proton Mail is also a favorite of Jack Dorsey, founder of Twitter and Square.
Proton Mail differs from typical email products. It can be used without binding a phone number and supports end-to-end encryption, ensuring private email transmission. Before Telegram's regulation, used with TG's end-to-end mode, it could basically build a current high-level commercial privacy experience.
Of course, after Telegram's decline, Proton Mail combined with Signal can also satisfy most people's privacy surfing needs.
Similar to Telegram, Proton has also started entering the Web3 domain, with its first product being Proton Wallet. Different from trading-oriented products like Bitget Wallet and Binance Wallet, Proton Wallet is exceptionally restrained, with relatively simple functions.
Proton's significance lies in proving the feasibility of building products based on privacy technology. Unlike traditional giants' ad revenue model, Proton adopts a paid system. Unlike Web3 peers' token economics, Proton hasn't reached the token issuance stage. We can call it:
Non-tokenized practice of cryptographic technology.
From Skiff to Nillion, Tokenization of Cryptographic Technology
If Proton is Don Quixote, then Skiff, Nym, Privasea, and Nillion are dwarfs - their PMF not yet found, but the token (Snow White) has already taken the lead.
On February 9, 2024, Notion announced acquiring Skiff, the first case of a Web2 large product acquiring a Web3 startup without taking the token issuance route, creating a new industry trend. To say more, Stripe's acquisition of Bridge was actually the second such case.
Skiff is similar to Google Suite, from IPFS-based document suite to encrypted email service, but with a huge problem: extremely ugly UI and no user experience, which is the biggest issue with current Web3 products. Limited by blockchain's underlying slowness and expense, developing large products based on it is difficult to defeat Web2 counterparts.
Proton is a suitable Google Alternative, but Skiff is not a qualified Proton Alternative.
Besides, other Web3 privacy products' development is unsatisfactory. Nym gradually shifted focus to the VPN domain later, FHE direction Privasea emphasizes more AI domain adaptation, and today's Nillion is still within the previous cycle's MPC narrative.
Yes, narratives are cycle-based. Nillion's built MPC and Blind Compute (NBC) concepts are derivative narratives of Ethereum and ZK applications in L2/Rollup domains. AA wallets and MPC paradigms belong to this category. As Ethereum's coin price weakens, privacy technology products are being abandoned by the market, most notably that FHE did not become ZK's next step. Reference face-slapping article: FHE is ZK's next step, as cryptographic technology says.
It's not that privacy technology isn't important, but the combination of privacy technology and tokens is no longer important, at least not at this stage.
Without privacy technology, Proton couldn't build its business logic and product matrix - this is a good PMF mode. But for products like Nillion, Binance and Hack VC's investment seems more important.
As for blind compute concepts, trusted layers, multi-ecology, privacy AI are not Nillion's real profit sources - we all know this. Nillion's only product might be its own token. From this perspective, at least Nym is truly trying to grab the VPN market.
In the latest technical paper, Nillion's research focus remains on MPC practice. Traditional secret sharing MPC algorithms experience dramatic data volume expansion during computation. Nillion is researching how to reduce algorithm complexity to improve computational efficiency.
How to put it? Let's just look at Nillion token's opening performance. As said before, these Web3 privacy technologies combined with AI cannot find real application scenarios because OpenAI and DeepSeek don't have these factors. If a new product adds privacy technology to grab market share from them, that would be a meaningful pioneering move.
If it's not meaningful, then let's look at @Optimism, which truly believes privacy is important.
But Privacy is Good still needs Privacy Product to demonstrate. Empty talks about MPC/ZK/TEE/FHE/AI are meaningless. Everyone can say problem-unsolved slogans, but ultimately it will harm the social reputation of the technology behind them.
The bad consequences have appeared. Now when people mention L2, they turn pale, and also make people feel ZK is a scam.
After Safe caused huge losses for Bybit, those who went silent included not just Vitalik, but also front-end guys and multi-sig mechanisms.
Conclusion
Monero (XMR), for people in today's BNB Chain meme speedrun era, has become somewhat unfamiliar. But it should be the last attempt after Bitcoin to truly consider how cryptographic technology and its application scenarios can be combined.
On February 7, 2024, two days before Skiff officially announced "joining" Notion, XMR was delisted from Binance, "exiting" its largest liquidity source. Perhaps from now on, so-called privacy technologies will be like F-47, just part of winning studies, except that Web3 privacy economics hasn't completely gone bankrupt yet.
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