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Zcash
Cryptocurrency aimed at privacy From Wikipedia, the free encyclopedia
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Zcash is a privacy-focused cryptocurrency which features an encrypted ledger using zero-knowledge proofs.[4]
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On Zcash, transactions can be transparent and publicly viewable, or they can be shielded transactions which use a type of zero-knowledge proof to provide anonymity in transactions. Zcash coins are either in a transparent pool or a shielded pool. Users can use Zcash wallets like Zashi,[5][6] which provide privacy by default by requiring funds to be shielded before they can be spent. As of July 2025,[7] approximately 20% of existing coins are shielded.
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Zcash is used as a privacy-focused cryptocurrency that enables users to send shielded (private) or transparent (public) transactions. Shielded transactions encrypt transaction data and use a zero-knowledge proof circuit to validate transfers without revealing sender, receiver, or amount. Zcash transactions can be transparent, similar to bitcoin transactions, in which case they are controlled by a "t-addr" or shielded and controlled by a "z-addr." A shielded transaction uses a type of zero-knowledge proof, specifically a non-interactive zero-knowledge proof, called "zk-SNARK," which provides anonymity to the coin holders. As of July 2025,[7] approximately 20% of the total ZEC coin supply is held in shielded addresses.
Zcash can be used through a variety of wallets, including Zashi, which enforces shielding of funds before spending and simplifies shielded transactions for users across platforms.[5][6] As of December 2017, only around 4% of Zcash coins were in the shielded pool and at that time, most cryptocurrency wallet programs did not support z-addrs, and no web-based wallets supported them.[8] The shielded pool of Zcash coins was further analyzed for security, and it was found that the anonymity set can be shrunk considerably by heuristics-based identifiable patterns of usage.[9]
Zcash employs a Proof-of-Work consensus mechanism similar to Bitcoin. Block rewards are split between miners and the Zcash development fund: 80% of the rewards go to miners, while 20% are allocated to sustain Zcash's development: 8% to Zcash Open Major Grants, 7% to Electric Coin Co., and 5% to The Zcash Foundation.[10][11]
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Development work on Zcash began in 2013 by Johns Hopkins University professor Matthew Green and some of his graduate students.[12] The development was completed by the for-profit Zcash Company, led by Zooko Wilcox, a Colorado based computer security specialist.[12] In October 2016, the Zcash Company raised over $3 million from Silicon Valley venture capitalists.[12]
Zcash was first mined in late October 2016.[13] The initial demand was high; within a week, ZEC was trading at over $5,000.[13] To generate revenue, 10% of all coins mined for the first four years were automatically distributed to the Zcash Company and the Zcash Foundation.[12]
The instantiation of the Zcash network required the creation of a master private key. To ensure privacy, this private key must later be destroyed, otherwise counterfeit Zcash coins could be generated. To maximize the chance that no one person could obtain the private key, software was written which allowed individuals from six different locations to collaboratively generate the private key, use it to instantiate Zcash, and then destroy the computers used in the process afterwards.[14][15] In 2022, Edward Snowden claimed to have participated in the creation of Zcash under a pseudonym.[16]
On February 21, 2019, the "Zcash Company" announced a rebranding as the Electric Coin Company (ECC).[17]
On May 19, 2020, a paper titled "Alt-Coin Traceability"[18] investigated the privacy of Zcash and another cryptocurrency, Monero. This paper concluded that "more academic research is needed in Zcash overall" and that the privacy guarantees of Zcash are "questionable." The paper claimed that, since the current heuristics from a 2018 Usenix Security Symposium paper entitled "An Empirical Analysis of Anonymity in Zcash"[9] continue today, the result is making Zcash less anonymous and more traceable.
On June 8, 2020, Chainalysis added support for Zcash to their Chainalysis Reactor and "Know Yr Transaction" (KYT) products. They noted that less than 1% of ZEC transactions were completely shielded, with the sender, receiver and amount all hidden, enabling Chainalysis to provide partial information for over 99% of ZEC activity.[19][non-primary source needed] Chainalysis also cites a research report by the RAND corporation, which revealed that less than 0.2% of the cryptocurrency addresses mentioned on the dark web were Zcash or Dash addresses.[20][19]
On October 12, 2020, the Electronic Coin Company announced a new non-profit 501(c)3 organization called the Bootstrap Project (Bootstrap) in a company blog post titled "ECC's owners to donate ECC".[21] Most of the investors and owners of Zerocoin Electric Coin Company LLC (ECC) have agreed to donate the ECC company as the wholly owned property of Bootstrap.[21] ECC's blog post claims that nothing will change within the company except the ownership,[21] including the Board of Directors.[21] On October 27, 2020, ECC announced that its shareholders had officially voted to donate 100 percent of its shares to Bootstrap.[22] On March 30, 2021, the company's transparency report said it is "now a wholly owned entity of the 501(c)3 Bootstrap."[23][24]
In September 2023, a mining pool named ViaBTC had seized control of over half the hashing power on Zcash. This 51% dominance raised worries about a 51% attack, where they could potentially manipulate transactions and harm the network. In response, Coinbase placed Zcash markets into "limit-only" mode in an effort to prevent significant price swings. [25]
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