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About Zcash
Key Points
- Zcash is a decentralized cryptocurrency focused on privacy and anonymity.
- It uses zk-SNARK zero-knowledge proof technology to verify transactions without revealing sensitive information.
- Zcash was founded in 2016 by Zooko Wilcox-O’Hearn.
- Zcash has a total supply limit of 21 million coins.
- New ZECs are created through “block subsidies” and halved at regular intervals.
- Zcash network is secured by the proof-of-work SHA-256 hash function.
- Zcash can be bought on major exchanges such as Binance, HitBTC, and Huobi Global.
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Zcash: The Pioneering Privacy Coin
Zcash (ZEC): The Pioneering Privacy Coin
Zcash is a decentralized cryptocurrency that prioritizes privacy and anonymity, leveraging the innovative zk-SNARK zero-knowledge proof technology to enable nodes on the network to verify transactions while maintaining the confidentiality of sensitive information.
In contrast to a prevalent misconception, the overwhelming majority of cryptocurrencies in circulation, including Bitcoin (BTC), are not anonymous, but rather pseudonymous; although they do not explicitly disclose the identities of their users, each user is associated with a unique public address or addresses that can be traced back to them through the application of data science and blockchain forensic techniques.
Zcash transactions, conversely, are still publicly broadcast on a blockchain, yet, unlike pseudonymous cryptocurrencies, ZEC transactions, by default, maintain confidentiality regarding the sender’s and recipient’s addresses, as well as the transaction amount. However, there is an option to voluntarily disclose this information, facilitating auditing and regulatory compliance purposes.
Zcash, initially launched on October 28, 2016, was built upon the foundation of Bitcoin’s codebase, leveraging its robust architecture.
The Visionaries Behind Zcash: Meet the Founders
Zcash was established in 2016 by the visionary cypherpunk, renowned computer security expert, and entrepreneur Zooko Wilcox-O’Hearn. Notably, he is also the founder of the for-profit Electronic Coin Company (ECC), which oversees the development of Zcash.
Wilcox-O’Hearn boasts an illustrious career spanning over 25 years in the realms of cryptography and information security, with notable contributions to a plethora of projects, including the erstwhile electronic money firm DigiCash, the pioneering peer-to-peer data storing software Mojo Nation, and the innovative Tahoe Least-Authority File Store filesystem.
He also established Least Authority Enterprises, a pioneering technology firm dedicated to bolstering digital security and safeguarding the fundamental right to privacy, and co-invented the BLAKE3 cryptographic hash function, a groundbreaking innovation in the realm of cryptography.
Zcash: Unveiling the Pioneering Power of Privacy
Zcash’s primary advantage stems from its optional anonymity feature, which affords a level of privacy that surpasses that of conventional, pseudonymous cryptocurrencies like Bitcoin and Ethereum.
ZEC transactions can be facilitated through two distinct methods: transparent and shielded.
Transparent transactions operate similarly to those in Bitcoin, upon which Zcash’s codebase was initially based: they are transmitted between public addresses and are chronologically recorded on an immutable public ledger (the blockchain). All pertinent information regarding these transactions is publicly accessible online, including the sending and receiving addresses, as well as the transferred amount.
Public transactions, while not explicitly revealing user identities, can still be traced back to their owners through their public addresses on the blockchain. Nevertheless, owing to the concerted efforts of data scientists and law enforcement agencies in recent years, blockchain analysis has advanced to the point where a motivated party can, with a reasonable degree of certainty, link a public address on a blockchain to the real-world identity of its owner, thereby rendering private transactions virtually impossible.
Shielded ZEC transactions, on the other hand, harness the power of zero-knowledge succinct non-interactive arguments of knowledge, commonly referred to as zk-SNARKs, to facilitate entirely anonymous transactions over a public, immutable blockchain. While the fact that a transaction has taken place is indeed recorded on the ledger, the sending and receiving addresses, as well as the amount transferred, remain confidential and are not disclosed to the public.
Zcash empowers users with the freedom to maintain their privacy while simultaneously benefiting from the advantages of a decentralized, permissionless digital currency.
The Circulating Supply of Zcash (ZEC): A Closer Look
Zcash’s tokenomics bears a striking resemblance to that of Bitcoin, characterized by its scarcity and mineability, with a capped total supply of 21 million coins.
New ZECs are created in the form of “block subsidies,” whereby a predetermined amount of coins is minted and distributed whenever a new block is successfully mined and appended to the blockchain. This subsidy is subsequently divided into two components: the “miner subsidy” and the “founders’ reward,” allocated at a ratio of 80:20, respectively. Furthermore, the block subsidy undergoes periodic halvings to deliberately slow the issuance rate as the total supply of ZEC approaches its predetermined limit of 21 million.
The miner subsidy is allocated to the miner responsible for mining the latest block, while the founders’ reward is distributed among the Electronic Coin Company (ECC) founders, the Zcash Foundation, ECC itself, and its employees. As of November 18, 2020, the block subsidy was halved from 6.25 ZEC to 3.125 ZEC, a change triggered at block 1,046,400 as part of the Zcash Canopy upgrade. This upgrade also eliminated the Founders Reward, replacing it with a new allocation structure, wherein the remaining 20% is divided among the Major Grants Fund, ECC, and the Zcash Foundation, at 8%, 7%, and 5%, respectively. The fifth Zcash network upgrade, dubbed Zcash NU5, is slated to launch on the testnet on September 30, 2021.
Since its inception, there has been considerable enthusiasm surrounding the ZEC to AUD and ZEC to EUR currency pairs, sparking significant interest among market participants.
The Zcash Network’s Security Mechanisms: A Robust Defense
The Zcash network is underpinned by the robust proof-of-work consensus mechanism, which leverages the SHA-256 hash function, a member of the SHA-2 family of algorithms, identical to the one employed by Bitcoin.
Acquiring Zcash (ZEC): A Comprehensive Guide to Exchanges and Platforms
Zcash is a prominent cryptocurrency, boasting a strong market presence. It can be readily purchased on a multitude of reputable exchanges, including:
- The esteemed Binance
- Renowned HitBTC
- Prominent Huobi Global
- Emerging BKEX
- Leading OKEx
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