As the cryptocurrency market navigated a turbulent week in early November 2016, a fascinating dynamic was unfolding in the privacy coin sector. Monero (XMR) surged more than 20% while Zcash (ZEC) — barely weeks old after its highly anticipated October launch — was in freefall, plunging close to 75% from its opening price.
TL;DR
- Monero surged over 20% from $4.99 to $6.13 during the first week of November 2016
- Zcash crashed approximately 75%, falling from $900 to $225.74 in the same period
- Bitcoin traded at $688.70 on November 3, down roughly 7% from the previous day
- Monero’s established dark web adoption gave it a significant edge over the newer Zcash
- Traders rotated capital from ZEC into XMR as Zcash’s steadily growing supply pressured prices downward
The Privacy Coin Divergence
The contrast between Monero and Zcash in early November 2016 could not have been more striking. Monero, which had been trading around $4.99 at the start of the week, rocketed past $6.13 — a gain exceeding 20% that placed it among the top-performing digital assets of the period. At the time, Monero’s market capitalization stood at approximately $64.8 million, with the coin ranked sixth on CoinMarketCap.
Zcash, on the other hand, was experiencing a brutal post-launch correction. After generating enormous excitement with its debut in late October 2016 — briefly trading above $900 — the cryptocurrency had lost nearly three-quarters of its value by November 3, settling around $225.74. The plunge was driven largely by Zcash’s rapidly expanding circulating supply, which was increasing significantly every week as new coins were mined.
Why Monero Won the Week
Several factors contributed to Monero’s strong performance during this period. First and foremost was the cryptocurrency’s established track record. Launched in 2014, Monero had two years of battle-testing behind it and had already achieved significant adoption on dark web marketplaces, where its privacy features were highly valued.
Petar Zivkovski, director of operations for leveraged bitcoin trading platform Whaleclub, noted that Monero was becoming an increasingly interesting asset for traders. He pointed to a developing dynamic between the two competing privacy platforms, suggesting that capital was flowing from Zcash sellers directly into Monero.
Jacob Eliosoff, a cryptocurrency fund manager, echoed this assessment. He explained that the total ZEC supply was still increasing very quickly every week, which meant more sellers and a dropping price, noting that these sellers appeared to be putting their proceeds into Monero.
The Broader Altcoin Landscape
While the Monero-Zcash drama dominated headlines, the broader altcoin market was relatively subdued. Ethereum’s ether (ETH) was trading at $10.80 on November 3, down slightly from $10.83 earlier in the week — a decline of less than 3%. Ethereum Classic (ETC) moved in the opposite direction, rising roughly 6% against bitcoin after exchange BTCC expressed interest in listing the digital currency.
Litecoin (LTC) was trading at $3.86 with a market cap of approximately $186 million, while XRP sat at $0.008 with a market cap of about $286 million. The total cryptocurrency market capitalization hovered around $11.8 billion — a fraction of what it would become in subsequent years.
Bitcoin’s Pre-Election Slide
The broader market context was shaped by bitcoin’s notable decline on November 3. The leading cryptocurrency dropped approximately 7% from roughly $742 to $687 in a single day, as uncertainty ahead of the US presidential election (scheduled for November 8) weighed on markets. Bitcoin’s market cap stood at approximately $11 billion.
This pre-election jitters period would prove to be short-lived. Within days of Donald Trump’s surprise victory, bitcoin would rally back toward $740, though the initial market reaction was characterized by cautious positioning and risk-off sentiment across digital assets.
Why This Matters
The Monero-Zcash dynamic of November 2016 illustrates a recurring theme in cryptocurrency markets: hype versus adoption. Zcash entered the market with cutting-edge zero-knowledge proof technology and massive initial valuations, but it was Monero — with its simpler but proven approach to privacy and its real-world usage — that delivered sustainable value for investors.
This episode also highlights how cryptocurrency market dynamics in late 2016 were still largely driven by retail traders and speculative positioning, with the entire market cap of all digital assets combined barely exceeding $11 billion. The infrastructure and institutional participation that would define later years was still in its earliest stages.
Disclaimer: This article is for informational purposes only and does not constitute financial advice. Past performance is not indicative of future results. Always conduct your own research before making any investment decisions.
fungibility_or_die_ the opt-in privacy flaw cannot be overstated. using shielded transactions on ZEC was basically putting a target on your back. XMR got it right by default
Kazuo T. ZEC from 900 to 225 in weeks with a 20% founder tax was the market pricing in the greed. XMR had organic darknet demand and fixed emission, no contest
ZEC launched at 900 with a 20% founder tax and cratered to 225 in weeks. XMR had fixed emission and real users. market got it right instantly
ZEC launching at $900 was pure market manipulation. tiny float, massive hype, then gravity took over. the founder tax just made it worse
opt-in privacy on ZEC was self-defeating. if youre the only one using shielded transactions youre automatically suspicious. XMR default privacy won by design
monero up 20% while zcash crashed 75% from $900 to $225. turns out actual dark web adoption beats fancy zk-SNARKs marketing every time
XMR had real usage and a proven privacy model. ZEC had theoretical privacy that nobody actually used in practice
dark web markets chose XMR because it worked out of the box. zcash required you to opt into privacy which defeated the entire point of a privacy coin
noir_pool_ exactly. opt-in privacy is an oxymoron. if shielding is optional then shielded transactions are permanently suspicious
opt-in privacy on ZEC meant the shielded pool was tiny and suspicious. using it actually drew more attention. XMR default privacy was the correct design from day one
noir_pool_ opt in privacy is an oxymoron. if you shield and nobody else does, your transaction is the only opaque one on chain. XMR default privacy was the correct architecture from day one
default privacy vs opt-in privacy was the entire ballgame. AlphaBay picking XMR over ZEC settled it before any forum debate could. adoption follows utility
Hye-rin P. default privacy was the correct architecture from the start. ZEC made privacy opt-in which means using it flags you as someone with something to hide. self defeating design
ZEC from $900 to $225 in weeks with steadily increasing supply plus the founder tax. basic econ 101. XMR had fixed emission and actual users. the market got the pricing right
Lev K. XMR tail emission kicked in right around this period too. flat supply narrative combined with actual users made it an easy hold vs ZECs inflation death spiral
the zcash tokenomics were brutal. slowly inflating supply with that 20% founder tax on top, no wonder the price collapsed
and the trusted setup ceremony was a huge red flag for the crowd that actually cared about privacy. monero needed none of that
the 20% founder reward on top of inflation was a dealbreaker for anyone who understood tokenomics. zcash was basically a startup masquerading as money
darknet markets voting with their feet in 2016 was the strongest signal. AlphaBay picking XMR over ZEC settled that debate before any tech argument could
XMR at 6 bucks in nov 2016 and nobody cared except the people actually using it. ZEC launched at 900 with a 20% founder tax and tanked 75% immediately. market got the pricing right
viewkey_truther the market got it right because ZEC tried to tax every transaction for founders. XMR just worked and asked for nothing
ZEC launched at 900 with a 20% founder reward and tanked 75% in weeks. the market punished the privacy tax immediately. XMR just worked and asked for nothing
ZEC from 900 to 225 with a 20% founder tax and slowly increasing supply. basic tokenomics punished the greed. XMR had fixed emission and actual users, market got it right
Kazuo T. the trusted setup ceremony was the real dealbreaker for cypherpunks. one compromised participant and the whole supply is forgeable. XMR needed none of that