Confidential coins cannot be controlled, therefore it is not surprising that governments do not like them and they intend to fight them. But for example, European politicians proposed deanimizing Zcash wallets so that the owners of this coin could further trade it on exchanges and use it for their own purposes. Apparently because of this, the price of Zcash, Dash and Monero fell so much.
Exactly. But still, privacy-oriented cryptocurrencies can be "rigged" by the developers themselves (like for example, placing a backdoor on the cryptocurrency for the government's intervention). As far as I know, Zcash is a privacy-oriented cryptocurrency which has plans of implementing a backdoor (if they didn't implemented it already) in order to allow governments to take action against any suspicious activity on the Blockchain. This would prove to be bad against the censorship resistance cryptocurrencies have been known for a long time. A link of the article explaining the backdoor can be seen here:
https://blockonomi.com/zcash-backdoor/Despite the efforts done by many governments worldwide, they'll never succeed because of the open-source and decentralized nature of crypto. If a specific privacy coin gets compromised, the community can easily create a new fork of the same with stricter anonymity features. The ecosystem will continue to adapt until it's resilient enough to withstand anything along the way. The strongest privacy-oriented cryptocurrency yet is Monero with a battle-tested technology that's proven to effectively anonymize every single transaction made on the Blockchain without intervention from third parties. Whereas other privacy coins like Zcash and Dash provide optional anonymity, Monero enforces it at the protocol level.
Nonetheless, it's no secret that governments want to gain control over the world's monetary system. The moment they see privacy coins rising in popularity, is such where they'll do anything at their disposal to stop them. After all, it's nearly impossible to track every single transaction made on privacy-oriented blockchain ledgers, which prevents the government from taxing them, as well as, tracking criminal activity. Which is why, the battle against privacy coins will be a never-ending one. Hopefully, privacy-oriented cryptocurrencies would survive for a long time as people give their full support. Just my thoughts
