Canary CEO Slams Zcash as ’Rug-Pull,’ Touts Litecoin as the True Privacy Contender

Privacy coins face a credibility crisis—and one industry CEO isn't pulling punches.

The Accusation That's Shaking Crypto's Shadows

The head of crypto investment firm Canary has launched a scathing attack on Zcash, labeling the once-celebrated privacy token a potential 'rug-pull.' The critique cuts to the heart of trust in cryptographic promises, questioning whether complex privacy tech delivers—or just distracts.

Litecoin's Stealth Play

In a surprising pivot, the executive is backing Litecoin's MimbleWimble upgrade as the 'real' privacy play. Forget theoretical shields; this pitch champions a battle-tested network adding optional anonymity—a pragmatic upgrade for a digital silver already in millions of wallets. It's a move that bypasses academic purity for real-world utility.

The Bottom Line for Your Portfolio

When a fund manager talks privacy, listen for the subtext: which asset moves quietly but packs liquidity? The endorsement hints at a market shift—from chasing cryptographic unicorns to backing networks that balance secrecy with spendability. After all, the best privacy feature might just be a coin you can actually sell without moving the market. A cynical take? Perhaps. But in finance, pragmatism often beats ideology.

Litecoin Better Than Zcash?

In a series of posts on X, McClurg said the Zcash surge that began roughly two months ago “triggered my curiosity.” After revisiting the project for the first time since 2016–2017, he wrote that he initially “bought into the Zcash narrative” but ultimately reached two conclusions.

“Litecoin has broader reach in terms of users, and MWEB an easier tool for selecting private wallets/transactions. It is my choice for privacy in US or UK due to compliance,” he argued. By contrast, “ZEC is a pump and dump getting ready to rug-pull. Be careful out there,” he posted last week via X.

Via X, McClurg followed up by highlighting Zcash’s sharp reversal on Monday. “Zcash [is] down 50% since this post. I hope people saw the post survived the rug pull. There is still further down to go,” he wrote, attributing the MOVE to “a stunt by bad actors.” He did not name specific counterparties, venues or structures, and his language focused on market behavior rather than protocol design.

Despite the harsh assessment of recent trading, McClurg stressed that his criticism is not a rejection of Zcash as a technology. “Btw, I have nothing against ZEC, as it was the first currency with private/public option,” he said. In the same thread he described himself as “longterm bullish on Litecoin, Monero, Dash, and Zcash in that order,” explicitly placing ZEC last in his personal privacy stack but still on the list.

The distinction he draws hinges on how privacy is implemented and how that interacts with compliance. Litecoin’s MimbleWimble Extension Block (MWEB) design adds an optional confidential LAYER alongside the transparent base chain, allowing users to move coins into a separate privacy domain while leaving total supply auditable. That structure, plus Litecoin’s broader distribution and exchange support, underpins McClurg’s claim that LTC is “my choice for privacy in the US or UK.”

Pressed on Monero’s role, McClurg said he has not researched it “in several years” but that, based on earlier work, he “always felt that it would be the winning currency for people in authoritarian regimes. Pure privacy.” At the same time, he added that Monero is “unfortunately likely not compliant for US citizens (not that it shouldn’t be),” capturing the tension between default privacy and current regulatory expectations.

Zcash, with its dual transparent and shielded address system, historically sat between those two poles. McClurg’s comments suggest that, in his view, the recent ZEC rally and crash reflect structural weaknesses in how the market around the asset is behaving, even if the underlying cryptography remains important.

He closed by warning that he hopes “this stunt by bad actors didn’t damage the importance of privacy chains and privacy features,” underscoring that his target is speculative excess rather than the broader push for on-chain financial privacy.

At press time, ZEC traded at $324.