a16z's "Privacy Trends in 2026"

1. Privacy Will Become the Most Important Moat in the Cryptocurrency Sector This Year. Privacy is a key feature of the global financial shift towards on-chain transactions, and one that almost all existing blockchains lack today. For most blockchains, privacy has always been an afterthought. But today, privacy itself is enough to set a blockchain apart from its competitors. Privacy also plays a more significant role: it creates a chain-locked effect; or, in other words, a privacy network effect. This is especially important in today's world where performance alone is no longer enough to win. Thanks to bridging protocols, migrating from one blockchain to another is effortless as long as all data is publicly transparent. However, once you make your content private, things change: cross-chain tokens are easy, but cross-chain secrecy is difficult. There is always a risk in entering and leaving private areas; someone monitoring the blockchain, mempool, or network traffic may be able to identify you. Crossing the boundary between private and public blockchains—or even between two private blockchains—leaks various metadata, such as the correlation between transaction time and transaction size, making it much easier to track someone down. Compared to numerous homogeneous new chains (whose fees are likely to be driven to zero due to competition, as block space has become essentially the same everywhere), privacy-focused blockchains can have stronger network effects. In fact, if a "general-purpose" chain doesn't have a thriving ecosystem, killer applications, or unfair distribution advantages, almost no one will use it or develop on it—let alone remain loyal to it. When users use public blockchains, they can easily transact with users on other chains—it doesn't matter which chain they join. However, when users use private blockchains, the chain they choose becomes crucial, because once they join a chain, they are less likely to easily switch, thus reducing the risk of information leakage. This creates a winner-takes-all situation. Because privacy is critical for most real-world applications, a few privacy chains may control the majority of cryptocurrencies. ~ Ali Yahya (@alive_eth), General Partner, a16z crypto 2. This year, the challenge facing instant messaging apps is not only how to defend against quantum attacks, but also how to achieve decentralization. As the world prepares for quantum computing, many cryptographically based instant messaging apps (such as Apple, Signal, and WhatsApp) have taken the lead and achieved significant success. The problem is that all mainstream instant messaging apps rely on our trust in private servers operated by a single organization. These servers are easily targeted by governments, which can easily shut them down, implant backdoors, or coerce users into handing over their private data. If a country can shut down your servers; if a company holds the keys to private servers; or even if a company owns private servers, what use is quantum encryption? Private servers need to "trust me"—but without private servers, it means "you don't need to trust me." Communication doesn't need any company as an intermediary. Messaging requires open protocols under which we don't need to trust anyone. The way to achieve this is a decentralized network: no private servers. No single application. All open source. Top-notch encryption—including resistance to 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. Shutting down a node will be economically incentivized to be replaced immediately by new nodes due to technologies like blockchain. When people own their information as they own their money—through keys—everything will change. Applications may evolve, but people always control their information and identity; even if the application itself isn't owned by the end user, they can now own their information. This is more important than quantum resistance and encryption; it's about ownership and decentralization. Without these two, all we're doing is building seemingly unbreakable encryption, but it can still be shut down. ~ Shane Mac (@ShaneMac), Co-founder and CEO of XMTP Labs 3. We will have "Key as a Service," making privacy a core infrastructure. Behind every model, agent, and automated process lies a simple dependency: data. But today, most data pipelines—the data that models input or output—are opaque, mutable, and unauditable. This might be acceptable for some consumer applications, but many industries and users, such as finance and healthcare, demand that companies keep sensitive data confidential. It's also a significant obstacle for institutions currently seeking to tokenize real-world assets. So, how do we achieve secure, compliant, autonomous, and globally interoperable innovation while ensuring privacy? There are many approaches, but I will focus on data access control: Who controls sensitive data? How does data flow? Who (or what) can access this data? Without data access control, anyone who wants to keep their data confidential currently has to use centralized services or build custom settings—which is not only time-consuming and labor-intensive but also prevents traditional financial institutions and other organizations from fully leveraging the capabilities and benefits of on-chain data management. As proxy systems begin to browse, transact, and make decisions autonomously, users and institutions across industries need cryptographic safeguards, not just “best-effort trust.” This is why I believe we need “Key as a Service”: new technologies that provide programmable native data access rules, client-side encryption, and decentralized key management, thereby mandating who can decrypt what data under what conditions, and for how long…all on-chain. By combining verifiable data systems, confidential information can become part of the internet's fundamental public infrastructure, rather than patching privacy protections at the application layer afterward, thus making privacy a core infrastructure. ~ Adeniyi Abiodun (@EmanAbio), Chief Product Officer and Co-founder of Mysten Labs 4. In security testing, we will shift from "code is law" to "standards are law". Last year's DeFi hacks also affected some well-established protocols with strong teams, rigorous auditing processes, and years of production experience. Therefore, these incidents highlight a disturbing reality: current standard security practices still rely heavily on rules of thumb and case-by-case approaches. To mature this year, DeFi security needs to shift from vulnerability patterns to design-level properties and from a "best-effort" approach to a "principled" approach: In the static/pre-deployment phase (testing, auditing, formal verification), this means systematically proving global invariants, rather than verifying carefully selected local invariants. Currently, several teams are building AI-assisted proof tools to help write specifications, propose invariants, and alleviate the costly manual proof engineering work of the past. In the dynamic/post-deployment phase (runtime monitoring, runtime enforcement, etc.), these invariants can be translated into real-time safeguards: the last line of defense. These safeguards will be directly encoded as runtime assertions that every transaction must satisfy. Therefore, instead of assuming every vulnerability is caught, we now enforce critical security properties in the code itself and automatically roll back any transactions that violate these properties. This is not just theoretical. In fact, almost all exploits to date have triggered one of these checks during execution, potentially preventing hacking. Therefore, the once-popular "code is law" concept has evolved into "standards are law": even entirely new attacks must meet the same security properties to ensure system integrity, thus leaving attacks either small-scale or extremely difficult to execute. ~ Daejun Park (@daejunpark), a16z crypto engineering team