The ban has actually driven up XMR. What is happening in the privacy coin sector?

Monero(XMR) increased by 8.31% in the past 24 hours, currently trading at $734.50, hitting a new all-time high. More notably, this rally is not an isolated event but the result of a significant rotation within the privacy coin sector. Amid the dual shocks of Dubai banning privacy coins and the departure of the Zcash core team, funds are accelerating from other privacy coins into Monero, driving it to become the privacy cryptocurrency with the highest market capitalization.

Short-term gains hit record highs, market sentiment fully turning positive

XMR’s strong performance exceeded expectations. According to the latest data, XMR not only gained 8.31% in 24 hours but also saw astonishing short-term gains: 69.77% over 7 days and 80.11% over 30 days. This means that in just one month, XMR’s price has nearly doubled.

Market capitalization has also surged significantly. XMR’s market cap has broken through $13.549 billion, up by $1.04 billion from the previous day, ranking 11th in the cryptocurrency leaderboard. The 24-hour trading volume reached $550 million, indicating a notable increase in market participation. It is worth noting that the total on-chain contract holdings increased by 69.3% in just four days, reaching 417,500 coins, reflecting traders’ optimistic outlook on XMR’s future.

Major capital rotation within the privacy coin sector

XMR’s rise is not happening out of nowhere but is driven by intense internal reallocation of funds within the privacy coin sector.

From Zcash crisis to Monero opportunity

The crisis faced by Zcash triggered this rotation. The collective departure of Electric Coin Company (the core developer of Zcash) severely damaged market confidence, causing ZEC’s price to drop approximately 15-16% during the same period. In stark contrast, Monero rose against the trend, widening the market cap gap between the two.

On-chain data clearly shows this rotation:

• Monero’s capital inflow is rapidly increasing, with the Chaikin money flow indicator continuing to rise
• Zcash shows net outflows
• During ZEC’s approximately 16% decline, XMR actually increased
• The market clearly recognizes Monero’s technological stability and decentralized governance structure

This is not a decline in the privacy coin sector but a market reassessment of the security and reliability of privacy coins. With its default privacy features, higher decentralization, and more mature privacy technology, Monero is gaining increasing capital favor.

Technical breakout with strong momentum

From a technical perspective, XMR’s rise is well-supported.

Market analysis indicates that XMR has strongly broken through the long-term resistance at $515, with limited retracement and sustained buying interest. The daily chart shows buy and sell forces in a neutral to bullish zone, with MACD and mid-to-long-term moving averages trending upward since early 2026, reflecting ample trend momentum. Price has rebounded from a low of $430.96 to a high of $798.91, forming a clear upward channel.

Some experienced traders compare XMR’s movement to historical silver patterns, noting that both exhibit double-top structures on monthly and quarterly levels. Such technical formations often signal the start of a trend-driven rally.

Policy bans instead strengthen privacy demand

Interestingly, after Dubai Financial Services Authority(DFSA) announced banning privacy coins from the country’s financial system, XMR’s price did not fall but rose instead. This counterintuitive movement contrasts with conventional regulatory logic.

Market interpretation suggests that regulatory bans have instead reinforced Monero’s core position in the narrative of “resistance to censorship” and “financial privacy.” As global compliance scrutiny tightens and cases of freezing stablecoins and traceable assets increase, Monero’s strong privacy features are attracting more attention. This policy pressure has, paradoxically, become a testament to the growing demand for privacy.

Future focus points

In the short term, the phase of concentrated selling pressure around the $480–$500 range warrants attention, as trading activity in this zone will directly influence the sustainability of subsequent breakthroughs.

More importantly, Monero’s FCMP++ upgrade is expected to occur in April 2026. This upgrade will significantly enhance the anonymity set, increase transaction speed by five times, and strengthen resistance against 51% attacks, potentially becoming the next major market catalyst.

Summary

XMR’s strong performance reflects a renewed market demand for privacy coins. Driven by accelerating sector rotation, continuous technical strength, and policy pressures that reinforce privacy needs, Monero is currently in a phase of trend and sentiment resonance. Although the current rally has already been substantial, considering its market cap share and capital inflow potential, there may be more stories ahead. However, market volatility risks always exist, and investors should maintain rational judgment.