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What is Zcash?

What is Zcash crypto
Zcash

If you have ever used the Bitcoin or Ethereum blockchain, then you know that any transactions that occur on the blockchain can transparently be tracked and verified. But, what if you don’t want your transactions to be displayed for the world to see? That is where Zcash comes in.

Zcash is a fast and confidential cryptocurrency with low fees. Zcash uses the zk-SNARK security protocol to ensure that any party involved in a transaction is verified without revealing any information about the transaction to the other party or the network.

Still curious to know more about this extremely secure cryptocurrency? Continue reading below to learn all about Zcash.

What is Zcash?

Understanding ZCash
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Zcash is forked from the original Bitcoin blockchain, aka an Altcoin. This means that a team of developers made a change to the Bitcoin blockchain’s protocol to create a new version of the blockchain, which is known today as Zcash.

Eli Ben-Sasson, Alessandro Chiesa, Christina Garman, Matthew Green, Ian Miers, Eran Tromer, and Madars Virza, who are scientists from MIT, Josh Hopkins, and other respected intuitions noticed in 2014 that there were security flaws in the original Bitcoin blockchain.

That’s why they decided to create Zerocash, which was later rebranded to Zcash, in 2016.

With Zcash, you can pay your friends, family, and service providers while taking advantage of Zcash’s shielded transactions that keep all your financial information private and in your control.

Also, you can use Zcash at many of your favorite stores and online retailers. From buying bagels to buying a beach vacation, Zcash is accepted by many retailers.

Understanding Zcash

At its core, Zcash is similar to Bitcoin with a maximum supply of 21 million coins, and approximately 14 million coins in circulation at the time of writing this. The main difference between Bitcoin and Zcash, however, is that Zcash encrypts its transaction data, whereas Bitcoin does not.

With that, the entire Zcash blockchain is encrypted, plus the security protocol zk-SNARK adds even more anonymity and security for its users.

Moreover, Zcash currently utilizes a proof-of-work (PoW) hashing algorithm called Equihash, which is incompatible with mining hardware and software used to mine Bitcoin.

However, a blog post published on November 19, 2021, by the company, stated they are working on transitioning from a PoW algorithm to a proof-of-stake (PoS) algorithm in the next three years, which is more environmentally friendly and efficient.

How does Zcash work?

How does ZCash work
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When it comes to using Zcash, you have two options to choose from.

  • Transparent addresses (t-addresses): mean that addresses can be tracked on the Zcash blockchain similarly to the Bitcoin blockchain.
  • Shielded addresses (z-addresses): are encrypted using zk-SNARK transactions, meaning you can’t see the data on the blockchain so transactions sent to them are not visible, nor are the funds a z-address holds.

That means if a t-address sends funds to a z-address, public eyes are not able to see where the funds were sent to. Likewise, if a z-address sends funds to another z-address, the transaction is completely shielded from the view of public eyes. This creates one of the most privatized and secure ways to send and receive cryptocurrency.

To use Zcash, you will first need to get your own Web3 wallet, and then purchase Zcash from any of their supported cryptocurrency exchanges.

After purchasing your own Zcash, you can use it to buy various goods and services, or you can exchange it for another type of money, including US dollars, Euros, or another fiat currency.

The future of Zcash

Considering Zcash was created to be an efficient, safe, and anonymous way to transact, Zcash aims to be around for years to come. And although Zcash is one of the top privacy coins available on the market, the developers promote complying with all regulatory requirements.

How safe is Zcash?

How safe is ZCash
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Compared to a credit card or cash, Zcash is much more secure because it is attack and censorship-proof, private, and only auditable with the users’ permission. Even when compared to Bitcoin, Zcash is more secure thanks to its encryption and an extra layer of security through zk-SNARk.

Below are some of the key features of Zcash’s safety.

  • Decentralized and attack-resistant
    Zcash is decentralized, meaning that it is maintained by a network of people and machines, not a centralized entity like a bank. Also, there is no central database, single point of failure, and no authority that can shut it down, you are in full control of your money.
  • Private addresses & transactions
    Zcash’s privacy means that users can send and receive cryptocurrency without disclosing any information about the transactions. However, if users want to be more transparent, they have that option as well.
  • Audit- and regulation-friendly
    Private addresses and transactions can be disclosed by users if they need to share information or comply with third-party audits and regulatory requirements.

Zcash is likely one of the most secure and confidential forms of cryptocurrency on the market with many pros that users can benefit from. As the world continues to evolve and accept cryptocurrency as a form of payment, I wouldn’t be surprised to see Zcash at the forefront of the market. 

Their dedication to security and privacy is admirable, and their commitment to comply with all regulatory requirements is promising.

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