ZEC Holders Vote Against Privacy Token Standard
Plus, Terraform Labs' admin sues Jane Street
Olivia Capozzalo & Denis Omelchenko
February 25, 2026
gm, Defiers!
Today’s big story:
- In the Zcash community’s recent sentiment poll, the most contentious item was a 2021 proposal that would make it possible to issue fully private tokens on Zcash.
In other news:
- Terraform admin sues Jane Street
- Bitwise acquires Chorus One
- Credit card stocks fall on AI report
- Coinspect Releases Wallet Security Ranking Update [SPONSORED]
Read more below! But first, please give our sponsors some love; they make this newsletter possible.
Great crypto products don’t build payment infrastructure from scratch, they partner with Mercuryo. As the backbone behind leading Web3 brands, Mercuryo delivers global on/off-ramp rails with regulatory burden removed.
We’re back! Here’s what you need to know in web3 today
📈 Markets in the Past 24 Hours
| TICKER | VALUE | 24H | |
|---|---|---|---|
 | Bitcoin | $68,674 | 6.94 % |
 | Ethereum | $2,072.2 | 11.69 % |
 | XRP | $1.47 | 7.81 % |
 | BNB | $629.05 | 7.02 % |
 | Solana | $88.57 | 13.61 % |
Today’s Big Story
Zcash Community Split Over ‘Flagship Feature’ That Aims to Bring DeFi to the Ecosystem
The Zcash Foundation has shared the results of its latest NU7 sentiment polling, and it’s pretty clear the community isn’t all on the same page. While some proposed changes got backing, one proposal — which the foundation referred to as a “flagship feature” — has turned into a real point of division.
NU7 isn’t a simple yes-or-no vote. It’s a bundle of sentiment polls on different proposals meant to shape the next network upgrade. The polling pulled input from governance members, coinholders, and other parts of the community.
The most contentious item was Zcash Shielded Assets — or just ZSAs — a proposal back from late 2021 that would create a token standard for issuing fully private tokens on Zcash, similar to ERC20 tokens on Ethereum. The proposal describes its goal as enabling a privacy-focused DeFi ecosystem on Zcash. The feature was developed mainly by teams funded by the Zcash Foundation and Electric Coin, Zcash’s development company, and it’s been framed as a major long-term bet for the whole network.
But in a blog post this week, the foundation said the poll results show “significant disagreement” around ZSAs, noting that governance groups largely backed the idea (over 70%), while coinholders overwhelmingly opposed it (nearly 99%).
Coinholder voting results. Source: forum.zcashcommunity.com
While it’s still not entirely clear what drove such an overwhelming “no” from ZEC holders, there is an on-the-record document that laid out potential risks tied specifically to ZSAs.
In 2024, a legal white paper, commissioned and published by the Zcash Foundation, looked at U.S. regulatory issues around ZSAs, warning that issuers of said tokens could face exposure to money transmitter rules, sanctions compliance, and securities laws.
It’s not clear if or how much that paper played into this recent vote, as even the Zcash Foundation noted in its blog post that they “need to understand why coinholders oppose ZSAs so strongly — whether it’s economic concern, technical risk, complexity, or something else.”
The debate lands amid a tense stretch for Zcash, which has recently dealt with governance disputes, as The Defiant reported earlier. Meanwhile, the price of ZEC has retraced much of the multi-month rally that kicked off last fall and made the asset last year’s best performing large-cap.
Even with all the disagreements, there are still some changes everyone seems to back, per the sentiment poll. Upgrades that make shielded transactions faster got near‑universal support, and improvements that help the network recover funds in case of rare errors were also popular across the board.
The community was also on board with changes to transaction fees, backing both clearer, explicit fees and the idea of burning a portion of those fees too.
Denis, staff reporter at The Defiant
Forwarded this newsletter? Subscribe for daily insights and curated news from The Defiant team, Monday-Saturday. It’s free.
🎬WATCH
Why DAO Governance Always Turns Political
In this episode of The Defiant Podcast, Cami sits down with Rune Christensen to discuss why DAO governance becomes a struggle for resources, how the "iron law of bureaucracy" emerges, and why Sky redesigned its architecture to survive it.
Watch the full interview:
Top News in the Past 24 Hours
Jane Street Accused of Intentionally Attacking Terra
Terraform Labs’ estate has filed a lawsuit against quantitative trading firm Jane Street, alleging that the firm abused insider knowledge to profit from Terra and that it inadvertently contributed to the downfall of the ecosystem.
Why it matters: Following the UST depeg, LUNA, now LUNC, plummeted from a $29 billion market capitalization to nearly zero in a matter of days.
Bitwise Expands Staking Capabilities with Chorus One Acquisition
Bitwise Investments has announced the acquisition of Chorus One, a leading provider of institutional staking services, marking an expansion in Bitwise's staking capabilities and on-chain offerings.
Why it matters: The institutional staking market has been experiencing rapid growth, with more institutions looking to participate in proof-of-stake networks.
Credit Card Stocks Fall After Citrini AI Report
Shares of major credit card companies fell on Monday after a thought experiment projection from Citrini Research raised concerns about how AI could disrupt the economy, and the payments industry in particular.
Why it matters: The situation underscores how quickly viral narratives can move markets and how sensitive both stocks and crypto are to FUD.
Trending on The Defiant
- Credit Card Stocks Fall After Citrini AI Report
- Jane Street Accused of Intentionally Attacking Terra
- Fluid Proposes Establishing a Foundation Funded by $3M Annual Grant From DAO
- Ethereum Foundation Pledges to Support Privacy-First, Permissionless DeFi
- Crypto Markets Struggle as BTC Slips Below $64K
- Crypto Traders Attempt to Frontrun ZachXBT’s Upcoming Exposé
That’s it for today — if you enjoyed this newsletter, tell your friends! https://thedefiant.io/subscribe
Free newsletters
Good reporting. Delivered.
Choose your coverage: crypto and DeFi, the future of finance, or both.
Free. Unsubscribe anytime.
