Source: A16z
Original title: Privacy trends for 2026
Compiled and edited by: BitpushNews
1. Privacy will become the most important moat in the crypto space this year.
Privacy is a key feature for the global financial migration to on-chain. However, almost all existing blockchains lack this feature. For most chains, privacy is merely an afterthought. But now, privacy itself is attractive enough to make a chain stand out from its competitors.
Privacy plays an even more important role: it creates a "chain-locked" effect; you could call it a "privacy network effect," especially in a world where mere competition for performance is far from sufficient.
Because of cross-chain bridge protocols, migrating from one chain to another is effortless as long as everything is public. However, once you get into privacy, the situation is completely different: transferring tokens is easy, but transferring secrets is difficult. There are always risks when entering and leaving privacy zones—those monitoring chains, mempools, or network traffic may be able to identify you. Crossing the boundary between privacy and public chains (or even between two privacy chains) can leak various metadata, such as the correlation between transaction time and size, making it much easier to track users.
Compared to many homogeneous new chains (whose transaction fees may be driven to zero due to competition as the block space has become largely homogenized), privacy-enabled blockchains can have much stronger network effects. The reality is that if a "general-purpose" chain doesn't have a thriving ecosystem, killer applications, or an unfair distribution advantage, then users or developers have little reason to use it or build on it, let alone maintain loyalty.
On public blockchains, users can easily transact with users on other chains, and the choice of which chain to use is not important. However, on privacy blockchains, the choice of which chain a user chooses becomes crucial because once they join, they are less likely to move away and risk having their identity exposed. This creates a "winner-takes-all" situation. Since privacy is a necessity for most real-world use cases, a few privacy chains may dominate the majority of the crypto market.
— Ali Yahya (@alive_eth), General Partner, a16z crypto
2. The key challenge for social applications this year: not only must they resist quantum attacks , but they must also be decentralized.
As the world prepares for quantum computing, many encryption-based social applications (such as Apple, Signal, and WhatsApp) have been at the forefront. The problem is that all major instant messaging tools rely on our trust in private servers run by a single organization. These servers are highly vulnerable to government shutdowns, backdoor installations, or forced transfers of private data.
What's the point of "quantum-resistant encryption" if a country can shut down your servers, if a company has the keys to a private server, or even if a company simply owns a private server?
Private servers require "trust me," while the absence of private servers means "you don't need to trust me." Communication doesn't need a single intermediary. Instant messaging requires open protocols so we don't need to trust anyone.
The path to achieving this goal is network decentralization: no private servers, no single application, fully open-source code, and top-tier encryption (including protection against quantum threats). 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 appear the next day. If a node is shut down, a new node will immediately replace it due to the economic incentives provided by technologies like blockchain.
Everything will change when people own their messages through private keys like they own money. Apps may come and go, but people will always control their information and identity; end users will own their messages, even if they don't own the apps.
This is more important than quantum resistance and encryption; it's about ownership and decentralization. Without both, we're just building an "unbreakable" cryptographic system that can be shut down at any time.
— Shane Mac (@ShaneMac), Co-founder and CEO of XMTP Labs
3. "Secrets-as-a-Service" will make privacy a core infrastructure.
Behind every model, agent, and automation lies a simple dependency: data. But most data pipelines today—whether input or output data to models—are opaque, volatile, and unauditable.
This isn't a problem for some consumer applications, but many industries and users (such as finance and healthcare) require companies to keep sensitive data confidential. This is also a major obstacle currently faced by institutions seeking to tokenize real-world assets (RWAs).
So how can we achieve secure, compliant, autonomous, and globally interoperable innovation while protecting privacy?
There are many approaches, but I will focus on data access control: Who controls sensitive data? How does it move? And who (or what) can access it? Without data access control, anyone wanting to maintain data confidentiality currently has to use centralized services or build custom settings. This is not only time-consuming and expensive, but also hinders traditional financial institutions from fully realizing the potential of on-chain data management. As AI agent systems begin to autonomously browse, transact, and make decisions, individuals and institutions across industries will need cryptographic guarantees, not just “best-effort trust.”
This is why I believe we need "Secrets-as-a-Service": providing programmable, native data access rules through new technologies; client-side encryption; and decentralized key management that mandates who can decrypt what content under what conditions and for how long... all of this is done on-chain.
By integrating verifiable data systems, secrets can become part of the internet's fundamental public infrastructure, rather than an application-layer patch for ex-post fixes. This would make privacy a core part of the infrastructure.
— Adeniyi Abiodun (@EmanAbio), Chief Product Officer and Co-founder of Mysten Labs
4. Security testing will evolve from "code is law" to "standards are law".
Last year's hacks in decentralized finance (DeFi) affected some battle-tested protocols with strong teams, rigorous audits, and years of operational experience. These incidents revealed a disturbing reality: current standard security practices remain largely heuristic and case-by-case.
To mature this year, DeFi security needs to shift from "finding vulnerability patterns" to "design-level attributes," and from a "best-effort" approach to a "principled" one.
In the static/pre-deployment phase (testing, auditing, formal verification): this means systematically proving "global invariants," rather than verifying manually selected local variables. Currently, several teams are developing AI-assisted proof tools that can help write specifications, propose invariants, and handle the previously costly manual proof engineering work.
In the dynamic/post-deployment phase (runtime monitoring, runtime enforcement, etc.): these invariants can be transformed into real-time guardrails—the last line of defense. These guardrails will be written directly as runtime assertions, and every transaction must satisfy these conditions.
Now, instead of assuming that every vulnerability has been caught, we enforce key security attributes on the code itself and automatically revert any transactions that violate these attributes.
This is not just theory. In practice, almost every exploit to date has triggered these checks during execution, thus preventing hacking at its source.
Therefore, the once-popular "Code is Law" has evolved into "Spec is Law": even novel attacks must satisfy the security properties that maintain the integrity of the system, so that the remaining attacks are either negligible or extremely difficult to execute.
— Daejun Park (@daejunpark), a16z crypto engineering team
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