Web3 Hasn't Pierced Bubble After 10 Years, Says Aztec Founder Zachary Williamson

Web3 has failed to break through the so-called bubble a decade after its launch, hindered by a lack of robust privacy solutions, according to Zachary Williamson, founder of Aztec, a privacy-focused blockchain firm.

In an interview with Benzinga on the sidelines of Eth Denver, Williamson argued that without meaningful privacy capabilities, Web3 remains stuck in a speculative loop of "coins and casino games," far from its original vision of sovereign programmable money.

His critique centers on Ethereum‘s ETH/USD architectural limitations and the broader industry's stagnation.

Williamson emphasized that privacy is not just a feature but a necessity for Web3 to compete with traditional finance and Web2 systems.

"We've not meaningfully pierced the Web3 bubble," he said, reflecting on Ethereum's trajectory since 2014. "We're still playing around with synthetic tokens that have no intrinsic value or NFTs that aren't linked to anything in the real world."

He attributes this failure to the absence of strong privacy tools, which he believes are critical for legitimate, real-world applications.

Aztec's work focuses on zero-knowledge cryptography to enable privacy-preserving smart contracts. It’s a technology Williamson says has been extraordinarily difficult to develop.

"To actually create a privacy network, a programmable privacy network, you need an unbelievably sophisticated zero-knowledge cryptography powering your network," he explained.

Also Read: Bitcoin Staking Industry Could Reach $10B By End Of 2025, Says Babylon Labs Co-Founder David Tse

He highlighted Aztec's invention of Plonk in 2019 — a zero-knowledge proof system — as a breakthrough, though he noted its evolution has required years of iteration to make privacy practical on resource-constrained devices like phones and laptops.

Williamson dismissed the idea that Ethereum could natively adopt such privacy solutions without a radical overhaul.

"Yes, Ethereum could in theory incorporate privacy, but it would have to become like Aztec, and if it does that, then it's no longer backwards compatible with everything else that it's done," he said.

Instead, he sees alternative Layer 1s or specialized Layer 2s driving privacy forward, with Aztec targeting Web3-native use cases to build legitimacy before challenging traditional systems.

The disconnect between crypto's optional privacy and traditional finance's inherent protections stems from legitimacy, not technology, Williamson argued.

He envisions a future where privacy enables preemptive compliance—stronger than retroactive checks in traditional markets—though he cautioned that regulatory acceptance will be a "long and grinding battle of attrition."

For now, he remains frustrated by Web3's inability to move beyond speculative assets, a shift he believes hinges on privacy becoming standard.

Read Next: AI Investment Surges As Investors Prioritize Efficiency And Early Market Entry, Says INSART CEO

Image: Shutterstock