ZEC is up 35% on the day, and has gained a whopping 1,700% over the past three months.

Privacy-focused cryptocurrencies are suddenly all the rage as traders rotate into assets that offer on-chain confidentiality.

The “Privacy” category currently boasts a market capitalization of $29.9 billion, up 16.6% on the day and more than 38% for the week. The sector vastly outperformed the broader cryptocurrency market cap, which is up just 1% on the day, according to CoinGecko.

The growth is being led specifically by strong gains in Zcash (ZEC), which is trading around $718, up 35% on the day and more than 1,700% over the past three months.

ZEC Chart

Analysts say Zcash’s surge reflects a combination of market momentum, growing demand for privacy, and technical upgrades, including the expansion of its shielded pool and wallet features that enable private transactions.

“There is real momentum here, but it’s not the old 2017 privacy coin hype,” said Maja Vujinovic, CEO and co-founder of Digital Assets at FG Nexus. “Two things are happening: regulators have tightened KYC everywhere, so people who want privacy are drifting back on-chain, and traders are piling into anything with big upside because liquidity in the big coins is thin.”

Vujinovic added that ZEC’s more than 1,700% rise in three months is “not random,” but noted that these coins continue to trade in relatively shallow markets.

“This is a mix of real interest and a rotation into neglected assets. If BTC or ETH volatility spikes, these moves can reverse fast,” she said. “Privacy is a real theme again, but this run is still mostly momentum and positioning.”

Other analysts say Zcash’s gains also reflect structural factors in the token’s design and privacy features. Jake Kennis, Senior Research Analyst at Nansen, noted that privacy is increasingly viewed as a necessity rather than a feature, helping to renew demand for private, self-sovereign transactions.

Kennis said Zcash’s technical features, including its zero-knowledge architecture, the Zashi wallet for shielded transfers, and integration with Solana, make the coin easier to use and more accessible.

He also added that its Bitcoin-like structure (i.e. fixed 21 million supply, Proof-of-Work consensus, and an upcoming halving), combined with zk-SNARK-enabled privacy, positions Zcash as a form of “encrypted Bitcoin.”

“The renewed attention and positive price action have brought in renewed attention from high-profile figures like Arthur Hayes and Barry Silbert,” Kennis concluded. “After years of underperformance, ZEC’s resurgence has attracted fresh capital flows.”

The recent rally has put privacy coins back in focus after months of little movement. The momentum has also spilled over into related areas, like the privacy-focused blockchains category, which is up 20% on the day and over 45% for the week, per CoinGecko.

Other privacy crypto tokens recording gains include Railgun (RAIL), up 50% in the past 24 hours, Litecoin (LTC), up 20% on the day and 8% over the week, and Monero (XMR), which has risen 8% on the day and 14% for the week.