Zcash (ZEC) is an open-sourced, decentralized cryptocurrency that focuses on privacy. Claiming to be the HTTPS layer of cryptocurrencies, Zcash officially launched on October 28, 2016, with a mission statement to “create an open, global economic platform from which no-one can be excluded.”
While this seemed like a generalized statement, Zcash soon established its core objective as a cryptocurrency that wanted to provide its users with a secure platform that would not only be inclusive but one that would also keep privacy as its top priority. After a year and a half of its launch, it is safe to say that Zcash is on the way to achieve that very goal.
Zcash is also one of those cryptocurrencies that have found significant traction in very little time, and that is mostly due to its privacy functionalities.
The so-called “privacy coins” segment in the cryptocurrency industry does not have many viable contenders that can actually pull off the job of protecting their users’ privacy to the hilt. Whereas, Zcash offers a prominent and somewhat of a tested solution.
Zcash proves that it is capable of doing that once it gets to fully implement its solutions throughout the platform.
Another factor of Zcash’s success is its team, which does not only comprise of people that are proficient in technology but also ones which have a cunning approach when it comes to marketing the privacy coin in a way that piques the interest of its target market.
Who created Zcash?
Zcash’s founder and chief executive officer is Zooko Wilcox-O’Hearn, a secure distributed systems specialist with over 20 years of experience in his field. Before launching Zcash, Wilcox-O’Hearn was involved with several IT projects, most of which focused on disruptive solutions.
These disruptive solutions were created with the aim of bringing innovation to the world through advanced technology, with some of them specifically working with the approach to supplement “self-contained economies and secure reputation systems”.
The projects that he worked on included the Tahoe Least-Authority File Store (Tahoe-LAFS), a decentralized and secure file system designed; the ZRTP protocol, which was a cryptographic system meant to negotiate keys for encryptions; and Least Authority, a cryptographic file-storage solution which he also founded himself.
After working on the aforementioned systems and a few other notable projects, O’Hearn started to feel the need to put his skills to use toward other creative endeavors. This time, he wanted to focus on something a little different.
He wondered what would be needed in order to create a truly private cryptocurrency which also remained accessible and easy to use for its community, these ponderings, led him to create Zcash.
Zcash was created with the help of quite a few collaborators.
Individuals who collaborated on the project came from places such as John Hopkins University, with people like, professor Matthew D. Green and students Christina Garman and Ian Miers. Several of these people came together and proposed the Zerocoin protocol which Zcash is based upon.
The Zerocoin protocol is supposed to facilitate transactions in a simple, secure and anonymous manner.
The Zerocoin protocol was meant to take components from Bitcoin and improve them to anonymize the public blockchain transactions with Bitcoin’s ledger posts for everyone to see. Together, O’Hearn, Green, Miers, and Garman incorporated Zerocoin to Zerocash, which eventually saw the light of day in Zcash.
While Wilcox-O’Hearn chose to serve as Zcash’s CEO, Green, Garman, and Miers all continue their contribution to the project by being a part of its team of scientists, which also includes Eli-Ben Sasson from Technion – Israel Institute of Technology, Alessandro Chiesa from UC Berkley, Eran Tromer from Tel Aviv University, and Madars Virza from MIT.
Along with its team of main scientists, Zcash also has dedicated development teams which focus on keeping the platform updated in order to provide the latest security and usability solutions to its users.
How does Zcash work?
Now that you know a little about Zcash and who started it, the next logical question would be: how does Zcash actually work?
Well, since Zcash’s top priority is privacy and security, it is built along the lines of providing a functioning cryptocurrency that also follows these fundamentals.
Staying true to its comparison of being the HTTPS layer of cryptocurrencies, Zcash works by encrypting the contents of its transactions whenever they are posted on the network. This process is similar to how a user’s information is not shared with a web server through HTTPS, not even by the website’s owners.
The algorithm works in a manner where not even the people working on the network to verify transactions are aware of the transactions complete details. Zcash is seen as prime privacy coin because of this method of truly making transactions private and secure from all parties. Being able to provide a true shield for users from any breach in security allows Zcash to be one of the top cryptocurrencies when it comes to privacy and security.
However, with the payment information being encrypted, the aforementioned people who work on the network still need a way to verify it. Zcash makes this possible from a “novel cryptographic method” by the name of “zero-knowledge proof construction” which is fashioned as “zk-SNARK.”
The proof constructions let the network keep a safe and secure ledger without users having to share their transaction information with anyone. However, even with the added confidentially, the ledger remains secure and functional, it simply doesn’t give out information on the parties involved or the size of the amount presented in the transaction.
Therefore, the zk-SNARKS implementation makes sure that there’s no stealing or malicious activity going on by being fair to users and the network itself.
However, private transactions on Zcash remain optional for now, with the team currently working to make all transactions private by default, which it plans to implement latest by next year.
For now, users can opt to make public transactions from Zcash, the information of which is posted on the network ledger. Zcash’s public payments are somewhat similar to Bitcoin’s process.
What makes Zcash a good option?
Much like any other piece of innovation and technology, Zcash has its pros and cons.
The biggest and most obvious advantage of using Zcash is its zk-SNARKS protocol. The technology implements true privacy for the transaction that it is used for, which is something that those users who value their privacy above everything would truly appreciate.
Furthermore, the network remains fast and free of any transaction issues as well, and with the planned upgrades that it has to make its blockchain more secure with allowing all transactions to go private in the future, it certainly promises its users a clear path ahead.
Apart from having a top-notch privacy solution, Zcash also boasts of a highly proficient development team behind it as well. This team has so far, proven its mettle in terms of delivering what they promised to the network’s users.
Zcash also has a helpful community for users who are known to be pretty helpful and offer useful information to aid others to get started and learn more about Zcash.
What makes Zcash bad?
The most obvious flaw is the glaring omission of having all transactions to be private, which leaves a lot to be desired for a network that is focused on privacy from the get-go.
However, since Zcash is already on the way to implement upgrades in order to make it happen, then the network can be given a pass with one stipulation. If the network does not implement private transactions all across the board, then it might lose the traction that it has gained so far.
For miners, there’s also a 20% tax on mined coins. It’s understandable that the tax is imposed to pay the network, but 20% is considered a large amount to be taxed with, so this can be a huge deal for individuals interested in Zcash.
Zcash’s official wallet client, available through its main command line client, is also specifically made for Linux, and while there are plenty of third-party options that can accept Zcash for you, it can be a little troublesome if you really only wanted to delve into Zcash.
Linux isn’t as widely used as Windows or even the Mac OS, and while the Linux system isn’t bad, it does mean that a lot of people won’t really have good access to the official Zcash wallet. The space this can take up can also be considered a downside. The program will take up around 8GB of space, and this can be way too much for some people.
However, this is the practice with most cryptocurrencies, where users who do not want to download the whole blockchain client can go after third-party yet reliable solutions. To give you some perspective, the “official” Bitcoin wallet, available through the Bitcoin Core client, takes more than 140 GB of space since it is also only accessible through the network’s blockchain client and not as a separate application.
For now, the pros of Zcash do outweigh the cons, and the way that the cryptocurrency is progressing, it might prove to be one of the top privacy coins of the cryptocurrency space in the future.
Zcash supported Wallets
By now, you might be getting more and more interested in holding some Zcash of your own, well you are going to need a couple of key items before you get started.
Of course, the first that you are going to be needing to get started in this space is a wallet. While Zcash’s official wallet is only Linux based, there are several other wallets you can work with to still use, store and send, Zcash.
Guarda Zcash Wallet:
This wallet is considered to be very secure, with a “Bulletproof SSL rating.” It’s very fast and even has a built-in exchange.
A multi-asset desktop wallet, Exodus comes with an integration of cryptocurrency exchange service ShapeShift and a clean interface to store and access various digital assets , including Zcash.
Jaxx supports many different cryptocurrencies, and runs on many different systems such as Windows, Mac, iOS and Android. It also has ShapeShift integrated into its system.
Bitpie is more of a mobile app wallet. It has a built-in anti-fraud system and can trade and exchange with others all over the world.
An online cryptocurrency wallet, Carbon Wallet uses a multi-signature system for added security. You can even use your smartphone to access the wallet.
Holy Transaction is a universal wallet that’s been around for a pretty long time. It provides access to several different cryptocurrencies such as Bitcoin, Ethereum, and of course Zcash.
A mainly mobile wallet with cold storage capabilities. Free Wallet holds extra security features, and supports several different cryptocurrencies, including Zcash.
The Ledger Nano S wallet is a hardware, cold storage wallet. Considered as one of the most secure wallet to hold cryptocurrencies, it also comes with support for multiple digital assets and allows users to store their Zcash effectively.
Trezor is another popular cold storage and hardware wallet. Apart from Ledger, Trezor remains to be one of the top-notch wallet solutions that are currently available in the cryptocurrency space.
Once you have picked out a wallet that best suits your criteria and your needs, you can start looking for exchanges that deal in Zcash in order to buy the cryptocurrency for yourself. Even though it’s a new cryptocurrency, there are several exchanges that support Zcash, and some of the most widely used and popular choices are listed below for your reference.
Bitfinex is a popular exchange that also accepts bank deposits for fiat transactions. Even though it does not entertain individual clients from the U.S., it remains a good option for international users who want to buy Zcash. BitFinex also has a mobile app even though it remains largely convenient to use it from a web browser.
Based out of the U.K., Bitlish’s unique selling point is the exchange charging very low fees. It also has a cold storage system and has been known to have great support services.
A U.S. based, more widely known exchange that puts security first with many “layers of protection.” Bittrex typically only allows cryptocurrency deposits and withdrawals with the exception of trades higher than $100,000, for which users need to contact the Bittrex support team to facilitate fiat transactions.
Kraken is a well-known exchange that supports many cryptocurrencies as well as fiat deposits through bank transfers. The exchange operates on different fees depending on trading pairs and cryptocurrencies, but for the most part they remain competitive with market prices.
U.S. based Poloniex has advanced trading tools and a 24/7 monitored cold storage system to protect your funds. However, it only accepts deposits in cryptocurrencies.
ShapeShift is also a fairly well known exchange platform. It’s a very simple to use, safe and secure exchange that also has its own mobile app. However, it also only accepts trades in cryptocurrencies.
An exchange platform with flat rate fees while also being fast and trustful, Changelly is a viable choice for users who already have some cryptocurrency of their own and want to trade it for Zcash.
CoinExchange supports a very large amount of cryptocurrencies including Zcash. Even though it is not as widely known as the other choices on the list, users may test it out for small trades and see how the option works out for them.
Is Zcash worth it?
Zcash has a lot of things that make it both good and bad. It’s best strength is definitely its higher security and privacy protection for its users. While its blockchain is decentralized, its upgrade and relevant options remain largely controlled by the Wilcox-O’Hearn and his team members, but that is not necessarily a bad thing because it allows for frequent updates that would eventually make Zcash a privacy powerhouse.
The project’s code is open-source as well, which makes it even better because it’s easier for users to get into it without a lot of obstacles. However, Zcash is still a fairly new platform, and doesn’t have a lot of experience yet to determine how well it will do.
While it’s not a bad platform, it is still in relative infancy as compared to other privacy coins such as Monero which allows private transactions all across its blockchain and has proven its worth with rigorous testing, whereas Zcash is still considered by many to have not gone under the test of time for one to really determine its vulnerabilities.
That is why, Zcash will likely still need to make a lot of growth before becoming a better, stable cryptocurrency platform.
That doesn’t mean that Zcash isn’t worth a shot though, and if you feel that Zcash suits your needs best, you should try it out and see if it works out for you. They have a great development team that will likely continue trying to make Zcash better over time for all of their users.
Zcash may be new, but it has a lot of potential worth looking into.