Privacy token Zcash (ZEC) slid 36 percent in a day on concerns over a protocol flaw, and an XRP Ledger (XRP Ledger) validator offered XRPL’s planned features as an alternative for privacy-focused users.

On June 5, blockchain outlet The Crypto Basic reported that XRPL validator Vet said privacy-minded users should consider moving to XRPL’s planned features.

The discussion drew attention because Zcash’s sharp fall was sparked by the disclosure of a technical flaw. Zcash fell more than 36 percent in 24 hours to $338. That was a steep drop compared with about $640 two days earlier. Market capitalisation also shrank to $5.66 billion from $10.36 billion, while 24-hour trading volume topped $2.7 billion. The move reflected the spread of large-scale selling and liquidations at the same time.

The direct cause was a flaw in the Zcash Orchard shielded pool introduced in 2022. Security researcher Taylor Hornby (테일러 혼비) raised the possibility that the flaw could have allowed fake ZEC to be created inside the private pool without detection, through double-spending or hidden inflation. Developers rolled out an emergency fix and carried out a hard fork, but concerns remain. Zcash’s privacy design makes it difficult to prove whether there was actual exploitation before the fix.

The market reaction was swift. Both institutional and retail investors moved to sell, and the fact that the issue surfaced right after a recent price rise added to selling pressure. Zcash also saw a sharp price drop earlier this year after the core development team resigned.

In this situation, Vet presented XRPL as an alternative for privacy-focused users. Vet urged on X, formerly Twitter, that Zcash participants review a move to XRPL’s planned privacy tools. It was an attempt to highlight a structure offering both privacy and controllability at a time when trust has been shaken.

The feature XRPL is preparing is called XLS-0096. It adds private transfers to multipurpose tokens, and is based on XLS-33 applied last year. XLS-33 set out a structure to make it easier to issue and manage fungible tokens such as stablecoins like RLUSD, loyalty points and real-world asset (RWA) tokens. For now, however, both balances and transaction histories are public, limiting uses where privacy is important.

XLS-0096 focuses on addressing that limitation. It hides balances and transfer amounts while keeping total issuance and issuer information verifiable. EC-ElGamal encryption and zero-knowledge proofs are used in the process. Outsiders cannot check individual balances or transfer amounts, but the system’s core rules are maintained.

The development direction is also aligned with institutional demand. XRPL aims to use the feature to support privacy, oversight and regulatory compliance at the same time. It targets demand from banks and large projects that require both confidentiality and transparency. Related discussions began in mid-September 2025 in XRPL standards talks, and Ripple researchers including Murat Cenk (무라트 젠크) and Anchal Malhotra (안찰 말호트라) are taking part in development.

The feature is still in an early stage of development. Its scope is limited to multipurpose tokens, and it does not apply to native XRP transactions. XRPL is also pushing to integrate a multipurpose token decentralised exchange (DEX) based on XLS-82. These updates are part of XRPL’s strategy to expand institutional decentralised finance (DeFi) and tokenisation.

The discussion shows that technical trust and the ability to comply with regulations are both becoming important in the privacy token market. As Zcash faces a test of trust amid the flaw controversy, XRPL is seeking to expand institutional privacy infrastructure by promoting both private transfers and verifiability. With XLS-0096 still at an early stage, whether it is adopted, its scope of application and market demand are expected to be key variables for future assessment.

XLS-96 for the non readers https://t.co/B2TDQGmBu9