“Shang Yang knew a horse’s strength; Bi Gan saw into men’s hearts.”

The day NIL rises to the sky, XMR fades from the shelf.

Blockchain was born from privacy technologies—particularly cryptography. From elliptic curves to zero-knowledge proofs, these innovations underscore the triumph of privacy economics in the Web3 era.

But reality is never so perfect. From the repeated delistings of XMR on both CEXs and DEXs, to the arrest of Tornado Cash’s founder, it becomes clear: even if Nillion gets listed on Binance, the hacker ethos of privacy-centric projects is fading, and their ability to deliver polished products remains in question.

When it comes to refining privacy-focused products, blockchain projects should take a page from their Web2 counterparts—there’s much to learn in terms of usability and positioning.

Proton Proves Privacy Can Be a Functional Product

Privacy is a feature, not a product.

Merely talking about how privacy enhances a product lacks practical meaning. In other words, privacy needs product-market fit (PMF) too.

Why can giants like Google and Meta continue to violate privacy while still keeping users hooked? It’s about convenience and network effects. If a product works out of the box and everyone is using it—even if you personally don’t want to—you’ll eventually adopt it anyway for compatibility at work or in daily life. That’s how users end up accepting everything that comes with Google.

Image caption: Big Tech fines
Image source: Proton

On this front, regulatory bodies have largely failed by relying on fines instead of enforcement. Take Google—the reigning champion of regulatory penalties—as an example: even its massive €2.974 billion fine could be recouped in about 16 days of business. These fines don’t benefit European tech companies either, leaving them even more powerless against Google’s dominance.

To address this imbalance, Proton took a different approach: building its own ecosystem from the ground up. Originating from CERN (the European Organization for Nuclear Research), Proton benefits from the inherent trust associated with the scientific community—far more credible than most private corporations. With cryptographic foundations, open-source code, and audited products, their privacy suite actually holds practical significance. You don’t need Google’s all-in-one suite to get the same functionality.

Of course, current network effects and economies of scale still heavily favor the tech giants. But compared to most blockchain-based privacy projects, Proton has delivered products that are genuinely usable in daily life—making it a legitimate Google alternative.

Image caption: Proton products and partial comparisons
Image source: @zuoyeweb3

Compared to the all-in-one suite of Google Workspace, Proton’s current ecosystem primarily revolves around Proton Mail, which is worth highlighting as a favorite of Jack Dorsey, founder of Twitter and Square.

Unlike typical email services, Proton Mail doesn’t require users to bind a phone number, and it supports end-to-end encryption, ensuring secure and private email transmission. Before Telegram came under regulatory scrutiny, pairing Proton Mail with Telegram’s end-to-end mode offered one of the most robust commercial-grade privacy communication setups available.

After Telegram’s decline in privacy credibility, Proton Mail combined with Signal remains a strong option for most privacy-conscious users.

Much like Telegram, Proton has begun expanding into the Web3 space, starting with Proton Wallet. Unlike trading-oriented wallets like Bitget Wallet or Binance Wallet, Proton Wallet is strikingly restrained in its design—offering only essential functionality and a minimalist feature set.

The significance of Proton lies in proving the feasibility of privacy-focused product development. Unlike traditional tech giants who rely on advertising for revenue, Proton follows a paid subscription model. And unlike many Web3 projects that embrace tokenomics, Proton has so far avoided launching a token.

We can think of this as:

A non-tokenized application of cryptographic technology.

From Skiff to Nillion: The Tokenization of Cryptographic Technology

If Proton is Don Quixote, then Skiff, Nym, Privasea, and Nillion are like the dwarfs—still searching for their product-market fit (PMF), while their token (Snow White) takes center stage.

On February 9, 2024, Notion announced its acquisition of Skiff—marking the first time a major Web2 company acquired a Web3 privacy startup that hadn’t taken the token route. It set a new precedent in the industry. (As an aside, Stripe’s acquisition of Bridge counts as the second such deal.)

Skiff, similar in concept to the Google Suite, offered tools like IPFS-based document editors and encrypted email. But it suffered from one major flaw: a painfully unattractive UI and an overall poor user experience. This highlights a major problem in current Web3 product design—blockchain’s slow and expensive infrastructure makes it extremely hard to compete with mature Web2 counterparts in building large-scale usable products.

Proton is a viable Google alternative; Skiff is not a suitable Proton alternative.

Outside of Skiff, the development of other Web3 privacy projects has also been underwhelming:

Nym has pivoted toward the VPN space.

Privasea, which focuses on Fully Homomorphic Encryption (FHE), is now emphasizing compatibility with AI use cases.

As for Nillion, it’s still stuck in last cycle’s MPC narrative.

Yes—narratives move in cycles. The concepts Nillion is built on—like MPC and Blind Compute (NBC)—are derivative narratives branching from Ethereum and ZK-related use cases in the L2/Rollup space. Smart contract wallets, MPC paradigms—these all belong to the same generation. But as Ethereum’s price action stagnates, privacy-tech narratives are increasingly discarded by the market. Perhaps the clearest sign is how FHE failed to become the “next ZK.”

(See the now-ironic article: “FHE Is the Next ZK” – Said Cryptography.)

The issue isn’t that privacy technology is unimportant. It’s that the combination of privacy tech and tokenization is no longer compelling—at least not right now.

Without privacy technology, Proton wouldn’t have been able to build its product logic or ecosystem. That’s a proper PMF model. But for products like Nillion, Binance and Hack VC’s investments seem far more central than the product itself.

As for the Blind Compute narrative—things like trusted layers, multi-ecosystem setups, or private AI are not really Nillion’s profit engines. We all know the truth:

Nillion’s only real product might just be its token.

In that regard, at least Nym is trying to compete in the VPN market for real.

Image caption: Nillion’s latest technical paper
Image source: Nillion

In its latest technical paper, Nillion remains focused on the practical implementation of MPC (Multi-Party Computation). Traditional secret-sharing MPC algorithms tend to cause a massive increase in data volume during computation. Nillion’s research is centered on reducing algorithmic complexity to improve computational efficiency.

That said—maybe it’s better to just watch how the Nillion token performs at launch. Once again, the issue with many of these Web3 privacy projects intertwined with AI is that they fail to identify real-world use cases. Neither OpenAI nor DeepSeek require these technologies. If a new product integrates privacy in a way that actually allows it to compete with those giants, then it might be a meaningful breakthrough.

If it doesn’t—then maybe we should just look at what @Optimism is doing. They at least seem to genuinely believe privacy matters.

“Privacy is good,” yes—but we still need privacy products to actually demonstrate it. Talking about MPC, ZK, TEE, FHE, or AI in a vacuum means nothing. Empty slogans that don’t solve real problems only damage the social credibility of the underlying technologies.

We’re already seeing the fallout. These days, mentioning L2 sparks panic. And ZK is increasingly viewed as a scam by many.

After Safe led to massive losses on Bybit, the silence wasn’t just from Vitalik—it also came from front-end engineers and multi-signature governance teams.

Conclusion

Monero (XMR)—once a staple of the privacy coin movement—now feels distant to many in today’s BNB Chain meme-speedrun era. Yet, it may well have been the last serious attempt after Bitcoin to meaningfully integrate cryptographic technologies with real-world use cases.

On February 7, 2024, just two days before Skiff announced its acquisition by Notion, XMR was delisted from Binance, effectively severing its access to the largest source of liquidity. Perhaps from that point on, privacy technology, like the infamous F-47, became just another part of the “win-theory” playbook—a narrative mechanism. The only difference is that Web3’s privacy economics hasn’t gone fully bankrupt… yet.

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