After years of being among the most popular cryptocurrencies in the late 2010s, privacy cryptos like Monero privacy coin lost their popularity in the early 2020s. There was a mix of reasons that influenced traders and investors to stop buying them. This includes increased regulatory scrutiny, a growing preference for privacy solutions within blockchains themselves, and delistings from major exchanges due to regulatory concerns.
However, privacy coins are seemingly making a return in 2025. Experts have highlighted growing BTC swaps and Monero’s tech update as some of the main drivers. For example, data shows a 230% increase in anonymous crypto transactions since the Markets in Crypto-Assets Regulation (MiCA) crypto regulation. All of this is signalling a possible privacy coins comeback happening in 2025.
Atomic Swaps
Atomic swaps are a term in the crypto industry that signifies the act of two people trading cryptocurrencies (like Monero for Bitcoin) directly, without using crypto exchanges. Monero atomic swaps use smart contracts to make sure that both participants complete the trade. If one side fails to do its part, nothing will happen. In short, it is a trustless and secure P2P method of exchanging cryptocurrency without involving major platforms.
Some may be wondering how Monero is improving privacy as a coin? The answer lies in the fact that all crypto trading has to go through crypto exchanges, and the only way to use crypto exchanges is to create an account and complete ID verification. In other words, once you disclose your identity to the exchange and provide your details, including your wallet information, your privacy is compromised.
That is where Monero’s ability to perform XMR atomic swaps comes in handy, bypassing centralized exchanges and bringing a major breakthrough for privacy-oriented traders. Now, anyone can exchange cryptos without needing to use the platforms that require ID verification, effectively re-enabling privacy in the crypto industry.
However, this also represents a problem for the regulators. By bypassing OFAC-compliant platforms, Monero users make it harder for governments to monitor and potentially block transactions. Traceless transactions could lead to issues like crypto sanctions bypass and the rise of darknet market trends. However, in the end, this is not illegal technology - it simply allows users to maintain their privacy and anonymity in blockchain, which is something governments have a problem with.
MiCA’s Aftermath
After years of preparation, the EU finally rolled out its MiCA crypto regulation on December 30, 2024. The new law introduced strict KYC, AML, and transparency laws, and at the same time, it outright ordered all compliant exchanges to remove Monero and other privacy coins from their platforms, marking them as investment risks. The post-MiCA crypto sector started to change, and those who wanted to engage with Monero and other privacy coins had to turn to non-regulated platforms, decentralized crypto exchanges, and similar XMR trading platforms.
In other words, users were not willing to give up on Monero, and that was reflected in its figures. The number of Monero transactions went from 5.9 million in 2020/2021 to 9.1 million (2021/2022). A similar spike in activity was noticed on GitHub, DEXes, and P2P platforms, signalling that the users were finding ways to trade outside of Monero-delisting exchanges.
However, this was also true for the Monero darknet use. The EU’s largest Monero market, Archetyp, saw its user count grow to around 612k before it was seized last month, in June 2025. This response suggests that MiCA did not disable privacy coins, but rather, it gave users the push to leave exchanges and adopt it fully, fueling its growth.
The Role of Monero
Monero was designed to enable privacy in the cryptocurrency industry, after it became clear that the blockchain's anonymity would soon be a thing of the past. The coin’s developers reinvented the privacy system, making it different from other chains. For example, other blockchains show all transactions publicly, and with a block explorer, users can find any transaction that ever happened on chains like Ethereum. Monero, on the other hand, hides these details through its native technologies.
It uses a mechanism called RingCT (Ring Confidential Transactions) to hide the amount of money being sent. Monero ring signature then mixes the user’s transaction with others, making it unclear who sent what. It also uses stealth addresses, which prevent the recipient’s wallet address from appearing on the blockchain, so both parties are protected.
Monero also features Dandelion++, a mechanism that protects the user’s IP address by routing the transaction through multiple nodes before it exits the protective tunnel and becomes visible to those monitoring traffic.
However, things won’t end there, as Monero continues to work on new upgrades that will further improve its technology. One example is Seraphis, an upgrade that aims to redesign transactions and address formats to enable larger anonymity sets, improve multisig, and enhance wallet usability. Another example is FCMP (Full-Chain Membership Proofs), which will allow users to prove that their coin is part of the entire UTXO set, thereby boosting privacy to near-perfection by hiding it among millions of others.
Use Cases of 2025
Monero’s use cases have evolved over time, as crypto enthusiasts now use the coin for a lot more than simple trading and a way of making a profit. Monero’s privacy and security technology allows its holders to make anonymous payments for various goods and services, send money overseas, and even fund political activism, charities, and make other kinds of donations.
The coin has also become a preferred method of payment on platforms like XMRBazaar and MyNymbox, where XMR payments exceed even Bitcoin Lightning Network transactions. In other words, the coin is thriving in 2025 and could potentially continue to grow in use cases, the amount of usage, and the number of users over time, as more people turn away from excessive oversight.
Risks & Rules
Despite the fact that crypto users want privacy and anonymity in crypto, the regulators have eliminated it as a price of acceptance. That means that coins like Monero, which can still offer it, have been banished from regulated platforms. Many major exchanges delisted it years ago, with smaller ones following in their footsteps in order to keep their licenses.
More than that, Monero developers are also facing problems because of their connection to the project. Some have been forced to reveal their identities and have been placed under heavy surveillance. There are even proposals to ban privacy coin code at the protocol level, which caused a lot of concern about censorship. So far, no such ban has been passed into law, but that doesn’t mean it won’t be at some point in the future.
Despite this, the coin’s community is not giving up on Monero, but rather, both the users and the developers are finding alternative solutions, such as moving to GitLab and self-hosted repositories. The Monero Community Crowdfunding System, which acts as the project’s funding arm, also doubled down on privacy tools such as alternative wallets and investments into the DEX infrastructure.
Investor View
For a long time, Monero users were asking whether the coin could survive if centralized rails vanished. This is why atomic swaps are a key concept that could allow XMR to survive even if no other platform would have it, allowing users to trade the coin directly for other cryptocurrencies. The process would still be safe and enable privacy for the traders, effectively serving as a hedge against surveillance.
That doesn’t mean that Monero is in the clear, and it likely never will be. Regulatory crackdowns will continue, on-ramp options will keep shrinking as platforms continue to delist the coin, and all of it could also significantly impact its price. But, Monero remains a solid option for those building diversified portfolios, as it operates as a largely non-correlated asset which is independent from the rest of the crypto industry.
Conclusion
Monero’s atomic swaps are more than just another feature meant to make the project more interesting. In fact, they could be the lifeline that might save it if it ever gets completely removed from centralized platforms. They enable its independence in a world where MiCA compliance is forcing exchanges to fall in line with its surveillance demands and limiting the crypto sector.
Amid all of that, XMR introduced a regulator-free P2P way to swap XMR with Bitcoin and enter the rest of the crypto sector, even though it means it has just painted an even larger target on its project, as well as its developers. Even so, the project has an advantage, as users and devs seeking financial freedom are ensuring that Monero’s protocols are evolving faster than regulatory policies. This does bring up the question: Will the regulators manage to catch up?