(Source.)
For many years, I thought privacy was a fake virtue and only valuable for self-defense. I understood that some people would be unfairly persecuted for their minority sexuality, say, or stigmatized disease status, but I always saw that more as a flaw in society and not a point in favor of privacy. I thought privacy was an important right, but that the ideal was not to need it.
I'm coming back around to privacy for a few reasons, first of which was my several year experiment with radical transparency. For a lot of that time, it seemed to be working. Secrets didn't pile up and incubate shame, and white lies were no longer at my fingertips. I felt less embarrassed and ashamed over the kind of things everyone has but no one talks about. Not all of it was unhealthy sharing, but I knew I frequently met the definition of oversharing-- I just didn't understand what was wrong with that.
I noticed after several years of this behavior that I wasn't as in touch with my true feelings. At first I thought my total honesty policy had purged me of a lot of the messy and conflicted feelings I used to have. But there was something suspiciously shallow about these more presentable feelings. I now believe that, because I scrupulously reported almost anything to anyone who asked (or didn't ask), I conveniently stopped being aware of a lot of my most personal and tender feelings. (Consequently, I 100% believe Trivers's theory of self-deception.) I had calloused my feelings by overexposing them, and made them my armor. When my real, tender feelings went underground, the "transparency" only got more intense, because I was left free to believe more flattering and shareable things about myself in the gap, conscience completely clear.
I finally think I understand what's wrong with oversharing. It's not that it's uncomfortable for the listener (though an important consideration, I still reject that as a good enough objection on its own); it's that oversharing is a defense mechanism that protects the oversharer from criticism or disapproval at the expense of self-intimacy. It's exposing parts of yourself that will chafe and blister under scrutiny. It's a particularly insidious way of wearing a mask, because you believe that what you're doing is taking the mask off.
I now think privacy is important for maximizing self-awareness and self-transparency. The primary function of privacy is not to hide things society finds unacceptable, but to create an environment in which your own mind feels safe to tell you things. If you're not allowing these unshareworthy thoughts and feelings a space to come out, they still affect your feelings and behavior-- you just don't know how or why. And all the while your conscious self-image is growing more alienated from the processes that actually drive you. Privacy creates the necessary conditions for self-honesty, which is a necessary prerequisite to honesty with anyone else. When you only know a cleaned-up version of yourself, you'll only be giving others a version of your truth.
Here's an image that's been occurring to me. Privacy creates a space in which unexpected or unsightly things can be expressed. It's like a cocoon for thoughts and feelings. A lot of ugly transformational work can take place there that simply couldn't occur in an open environment (the bug literally dissolves!). The gnarly thoughts and feelings need to do their work undisturbed by any self-consciousness or fear of judgment, just like caterpillars need a tight encasement where the wind won't scatter their components as they reassemble into butterflies. Without that safe cocoon for thought- and feeling-caterpillars to metamorphose, the caterpillars can resort to burrowing inside you, eating through your systems and growing abnormally large. When weird malfunctions come up, and you're unaware of the cause, all that's left is for you to confabulate. So "transparency" has taken you from a knowing liar into an unwitting liar. But worst of all is that you don't have any of the butterflies that would have come from holding your stuff in a precious way.