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{{Short description|Cryptocurrency aimed at privacy}}
{{Proposed deletion/dated
{{About-distinguish|the cryptocurrency Zcash|Zerocoin|zcache}}
|concern = Unreleased cryptocurrency, no real indication of notability
{{pp-semi-indef|small=yes}}
|timestamp = 20161007180247
{{Multiple issues|
|help =
{{primary sources|date=November 2020}}
{{unreliable sources|date=November 2020}}
}}
}}
{{about|'''Zcash''' (cryptocurrency), not about Zerocoin|that|Zerocoin}}
{{Use dmy dates|date=February 2016}}
{{Use dmy dates|date=February 2016}}
{{Infobox currency
{{Infobox cryptocurrency
| symbol =
| image_1 = File:Zcash-logo-black.png
| ticker_symbol = ZEC
| image_title_1 = Zcash logo
| currency_name = Zcash
| date_of_introduction = {{Start date and age|df=yes|2016|10|28}}
| image_1 = Zcash logo (2024–present).svg
| using_countries = Worldwide
| image_2 =
| inflation_title = [[Monetary inflation|Supply growth]]
| inflation_rate = edit
| image_width_1 = 120px
| image_title_1 =
| inflation_source_date =
| symbol = ZEC
| precision =
| white_paper = [https://zips.z.cash/protocol/protocol.pdf Zcash Protocol Specification]
| implementations =
| initial_release_version =
| initial_release_date = {{Start date and age|df=yes|2016|10|28}}
| iso_code = ZEC{{efn|Unofficial.|group=infobox}}
| block_reward = 3.125 ZEC (80% to miners; 20% is portioned out to a Major Grants Fund (8%), Electric Coin Co (7%), and the Zcash Foundation (5%)), from Canopy upgrade until first halving<ref name="FAQs" /><ref name="Canopy">{{Cite web |url=https://z.cash/upgrade/canopy/ |title=Canopy |access-date=2023-04-17 |archive-date=17 April 2023 |archive-url=https://web.archive.org/web/20230417152104/https://z.cash/upgrade/canopy/ |url-status=live }}</ref>
| circulating_supply =
| supply_limit = 21,000,000<ref name="FAQs">{{Cite news |title=Frequently Asked Questions - Zcash |newspaper=Zcash |url=https://z.cash/support/faq/#zcash-economics |access-date=10 July 2019 |archive-date=24 June 2019 |archive-url=https://web.archive.org/web/20190624181645/https://z.cash/support/faq/#zcash-economics |url-status=live }}</ref>
| exchange_rate =
| market_cap =
| footnotes = {{notelist|group=infobox}}
| status = Active
| latest_release_version = 5.7.0
| latest_release_date = {{Start date and age|df=yes|2023|03|13}}<ref>{{Cite web |title=Releases - zcash/zcash |url=https://github.com/zcash/zcash/releases |access-date=4 Apr 2023 |via=[[GitHub]] |archive-date=18 April 2023 |archive-url=https://web.archive.org/web/20230418093838/https://github.com/zcash/zcash/releases |url-status=live }}</ref>
| project_fork_of = [[Bitcoin Core]]
| programming_languages = [[C++]] and [[Rust (programming language)|Rust]] (zcashd), [[Python (programming language)|Python]] (zcashd test suite), [[Rust (programming language)|Rust]] (zebra), [[Kotlin (programming language)|Kotlin]] (Android SDK), [[Swift (programming language)|Swift]] (iOS SDK), [[Go (programming language)|Go]] (lightwalletd)
| split_date =
| split_from =
| hash_function = [[Equihash]]
| issuance_schedule = Similar to Bitcoin, with "slow start" and different block interval
| timestamping =
| merged_mining_parent =
| block_time = 75 seconds (post-Blossom upgrade)<ref name="FAQs" />
| operating_system = [[Linux]], [[Windows]], [[macOS]]
| author =
| developer = [[Electric Coin Company]] (zcashd), [[Zcash Foundation]] (zebra)
| source_model = Open source
| license = [[MIT License|MIT]] (main zcashd code); MIT/[[Apache License|Apache]] (zebra and some support libraries); BOSL (orchard)
| website = {{URL|https://z.cash}}
| block_explorer = {{URL|https://zcashblockexplorer.com/}}
| ledger_start =
| code_repository = {{URL|https://github.com/zcash/zcash}}
}}
}}
<!-- WORK IN PROGRESS - please see https://z.cash/ for up-to-date information. -->
'''Zcash''' is a decentralized and open-source [[cryptocurrency]] that offers privacy and selective transparency of transactions. Zcash payments are published on a public blockchain, but the sender, recipient, and amount of a transaction remain private.<ref>{{Cite web|url=https://news.bitcoin.com/snowden-zcash-bitcoin-risks/|title=Snowden: Anonymous 'Zcash' Could Solve Bitcoin Surveillance Risks|accessdate=2016-10-08|author=Jon Southurst|date=2016-06-07|publisher=Bitcoin.com}}</ref><ref>{{Cite web|url=https://z.cash/about.html|title=Zcash - About|accessdate=2016-10-08|quote=Zcash is a decentralized and open-source cryptocurrency that offers privacy and selective transparency of transactions. Zcash payments are published on a public blockchain, but the sender, recipient, and amount of a transaction remain private.}}</ref>


'''Zcash''' is a privacy-focused [[cryptocurrency]] which is based on Bitcoin's codebase.<ref>{{Cite news |title=The Basics {{!}} Zcash |language=en-US |work=Zcash |url=https://z.cash/the-basics/ |access-date=2020-07-10 |archive-date=9 June 2022 |archive-url=https://web.archive.org/web/20220609175634/https://z.cash/the-basics/ |url-status=live }}</ref> It shares many similarities, such as a fixed total supply of 21 million units.<ref name="NYT">{{Cite news |last=Popper |first=Nathaniel |date=2016-10-31 |title=Zcash, a Harder-to-Trace Virtual Currency, Generates Price Frenzy |work=The New York Times |url=https://www.nytimes.com/2016/11/01/business/dealbook/zcash-a-harder-to-trace-virtual-currency-generates-price-frenzy.html |access-date=26 January 2017 |archive-date=11 January 2019 |archive-url=https://web.archive.org/web/20190111120448/https://www.nytimes.com/2016/11/01/business/dealbook/zcash-a-harder-to-trace-virtual-currency-generates-price-frenzy.html |url-status=live }}</ref>
{{TOC limit|3}}

Transactions can be transparent, similar to bitcoin transactions, 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.

Zcash offers private transactors the option of "selective disclosure", allowing a user to prove payment for auditing purposes. One such reason is to make it easier for private transactors to comply with [[Money_laundering#Anti-money_laundering|anti-money laundering laws]] and tax regulations.<ref>{{Cite news |last=Clozel |first=Lalita |date=31 October 2016 |title=How Zcash Tries to Balance Privacy, Transparency in Blockchain |language=en |work=American Banker |url=https://www.americanbanker.com/news/how-zcash-tries-to-balance-privacy-transparency-in-blockchain |access-date=24 July 2017 |archive-date=7 August 2017 |archive-url=https://web.archive.org/web/20170807232847/https://www.americanbanker.com/news/how-zcash-tries-to-balance-privacy-transparency-in-blockchain |url-status=live }}</ref>

==Use==

Zcash transactions can be transparent, similar to bitcoin transactions, in which case they are controlled by a "t-addr", or they can be shielded and are 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 in the transaction. Zcash coins are either in a transparent pool or a shielded pool. 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.<ref name="quesnelle">{{Cite arXiv |eprint=1712.01210 |class=cs.CR |first=Jeffrey |last=Quesnelle |title=On the linkability of Zcash transactions |date=2017}}</ref> The shielded pool of Zcash coins were further analyzed for security and it was found that the anonymity set can be shrunk considerably by heuristics-based identifiable patterns of usage.<ref name=":0">{{Cite book |last1=Kappos |first1=George |last2=Yousaf |first2=Haaroon |last3=Maller |first3=Mary |last4=Meiklejohn |first4=Sarah |date=2018 |title=An Empirical Analysis of Anonymity in Zcash |url=https://www.usenix.org/conference/usenixsecurity18/presentation/kappos |language=en |pages=463–477 |isbn=978-1-939133-04-5 |access-date=17 April 2020 |archive-date=26 April 2020 |archive-url=https://web.archive.org/web/20200426184117/https://www.usenix.org/conference/usenixsecurity18/presentation/kappos |url-status=live }}</ref>

While miners receive 80% of a [[block reward]], 20% is given to the "Zcash development fund": 8% to Zcash Open Major Grants, 7% to Electric Coin Co., and 5% to The Zcash Foundation.<ref>{{Cite news|title=Zcash development and governance - Zcash|language=en-US|work=Zcash|url=https://z.cash/zcash-development-and-governance/|access-date=2021-06-22|archive-date=24 June 2021|archive-url=https://web.archive.org/web/20210624204926/https://z.cash/zcash-development-and-governance/|url-status=live}}</ref><ref>{{Cite web|title=Reaching Consensus|url=https://electriccoin.co/reaching-consensus/|access-date=2021-06-22|website=Electric Coin Company|language=en-US|archive-date=23 June 2021|archive-url=https://web.archive.org/web/20210623115238/https://electriccoin.co/reaching-consensus/|url-status=live}}</ref>


== History ==
== History ==
Starting in 2014, the Zcash protocol (briefly know as "Zerocash") was developed through a collaboration between the original Zerocoin researchers at John Hopkins University and a group of cryptographers at MIT, the [[Technion - Israel_Institute_of_Technology|Israel Institute of Technology]], and [[Tel Aviv University]], who together were able to improve upon the original design by making it more efficient and more anonymous.<ref>{{Cite book|url=http://zerocash-project.org/media/pdf/zerocash-extended-20140518.pdf|title=Zerocash: Decentralized Anonymous Payments from Bitcoin (extended version)|last=Eli|first=Ben-Sasson|publisher=|year=2014|isbn=|location=|pages=}}</ref>


Development work on Zcash began in 2013 by [[Johns Hopkins University]] professor Matthew Green and some of his graduate students.<ref name="NYT"/> The development was completed by the for-profit Zcash Company, led by [[Zooko Wilcox-O'Hearn|Zooko Wilcox]], a [[Colorado]] based computer security specialist and [[cypherpunk]].<ref name="NYT"/> In October 2016, The Zcash Company raised over $3 million from [[Silicon Valley]] venture capitalists to complete the development of Zcash.<ref name="NYT"/>
The Zcash porject was formally announced by [[CEO]] [[Zooko Wilkox]] on Jan 20, 2016, as an evolution of the existing [[Zerocoin]] project (the work of Matthew Green, Ian Miers, Christina Garman, Aviel D. Rubin, at The Johns Hopkins University Department of Computer Science, Baltimore)


Zcash was first mined in late October 2016.<ref name="OuNov2016">{{cite web |last1=Elaine |first1=Ou |title=Bitcoin Isn't Anonymous Enough |url=https://www.bloomberg.com/opinion/articles/2016-11-01/bitcoin-isn-t-anonymous-enough?sref=UsAjUhBb |website=Bloomberg.com |publisher=Bloomberg |access-date=17 November 2020 |date=November 1, 2016 }}</ref> The initial demand was high, and within a week Zcash coins were trading for five thousand dollars a piece.<ref name="OuNov2016"/> Ten percent of all coins mined for the first four years were to be allotted to the Zcash Company, its employees, the investors, and the non-profit Zcash Foundation.<ref name="NYT"/>
{{quote|"With the new Zerocash protocol, unlike the old Zerocoin protocol, users can make direct payments to each other with a vastly more efficient cryptographic protocol that also hides the amount of the payment, not just its origin."}} This new protocol by Eli Ben-Sasson, Alessandro Chiesa, Christina Garman, Matthew Green, Ian Miers, Eran Tromer, and Madars Virza produced a coin which would no longer be an “Add-On” to the original Bitcoin but instead would be a new full-fledged digital currency.

The setup of Zcash required the careful execution of a trusted setup procedure, something that subsequently became known as "'''The Ceremony'''"<!-- bolded per [[WP:MOSBOLD]], as the redirect for [[The Ceremony (cryptography)]]) as a redirect target -->. to create the Zcash [[private key]]. In order to ensure privacy, a truly [[random number|random]] enormous number needed to be generated to be used as the private key, while also ensuring that no person or computer retains a copy of the key, or could subsequently regenerate the key. If the private key were available, [[counterfeit]] Zcash coins could be generated. The Ceremony was a two-day process, executed simultaneously during a short window of time in six different locations globally, by persons who did not know in advance who else was going to be participating in the event. The private key was generated, and used to instantiate Zcash, and the computers used in the process were reportedly destroyed.<ref name=npr20210225>{{cite news |title=The Ceremony |url=https://www.wnycstudios.org/podcasts/radiolab/articles/ceremony |last1=Webster |first1=Molly |last2=Kielty |first2=Matt |work=[[Radiolab]] |publisher=[[National Public Radio]] |date=25 February 2021 |access-date=29 June 2021 |archive-date=28 June 2021 |archive-url=https://web.archive.org/web/20210628223502/https://www.wnycstudios.org/podcasts/radiolab/articles/ceremony |url-status=live }}</ref><ref>{{Cite web |date=2017-12-21 |title=Zcash: Meet Zooko Wilcox, the Man Building a Better Bitcoin {{!}} Fortune |url=https://fortune.com/2017/12/18/jp-morgan-bitcoin-zcash-wilcox/ |access-date=2022-12-27 |archive-url=https://web.archive.org/web/20171221073939/https://fortune.com/2017/12/18/jp-morgan-bitcoin-zcash-wilcox/ |archive-date=21 December 2017 }}</ref> In 2022, [[Edward Snowden]] claimed to have participated in The Ceremony under a pseudonym.<ref>{{Cite web |title=Edward Snowden says he was the mystery man involved in the creation of leading privacy cryptocurrency Zcash |url=https://fortune.com/crypto/2022/04/28/edward-snowden-crypto-zcash/ |access-date=2022-11-02 |website=Fortune |language=en |archive-date=2 November 2022 |archive-url=https://web.archive.org/web/20221102060005/https://fortune.com/crypto/2022/04/28/edward-snowden-crypto-zcash/ |url-status=live }}</ref>

On February 21, 2019, the "Zcash Company" announced a re-branding as the Electric Coin Company (ECC).<ref name=":6">{{Cite web |date=2019-02-21 |title=Goodbye, Zcash Company. Hello, Electric Coin Company. |url=https://electriccoin.co/zh/blog/goodbye-zcash-company-hello-electric-coin-company/ |access-date=2020-11-09 |website=Electric Coin Company |language=en-US |archive-date=21 October 2020 |archive-url=https://web.archive.org/web/20201021201008/https://electriccoin.co/zh/blog/goodbye-zcash-company-hello-electric-coin-company/ |url-status=live }}</ref>

On May 19, 2020, a paper titled "Alt-Coin Traceability"<ref>{{Cite journal |last1=Ye |first1=Claire |last2=Ojukwu |first2=Chinedu |last3=Hsu |first3=Anthony |last4=Hu |first4=Ruiqi |date=2020 |title=Alt-Coin Traceability |journal=Cryptology ePrint Archive |url=https://eprint.iacr.org/2020/593 |access-date=27 August 2020 |archive-date=12 August 2020 |archive-url=https://web.archive.org/web/20200812022026/https://eprint.iacr.org/2020/593 |url-status=live }}</ref> investigated the privacy of Zcash and another cryptocurrency [[Monero (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"<ref name=":0" /> still 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 Your 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.<ref name=":1">{{Cite web |title=Introducing Investigation and Compliance Support for Dash and Zcash |url=https://blog.chainalysis.com/reports/introducing-chainalysis-investigation-compliance-support-dash-zcash |access-date=2020-09-05 |website=blog.chainalysis.com |date=8 June 2020 |language=en |archive-date=16 September 2020 |archive-url=https://web.archive.org/web/20200916125112/https://blog.chainalysis.com/reports/introducing-chainalysis-investigation-compliance-support-dash-zcash |url-status=live }}</ref>{{primary inline|date=May 2023}} 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.<ref>{{Cite web |last1=Silfversten |first1=Erik |last2=Favaro |first2=Marina |last3=Slapakova |first3=Linda |last4=Ishikawa |first4=Sascha |last5=Liu |first5=James |last6=Salas |first6=Adrian |date=2020-05-06 |title=Exploring the use of Zcash cryptocurrency for illicit or criminal purposes |url=https://www.rand.org/pubs/research_reports/RR4418.html |language=en |access-date=5 September 2020 |archive-date=21 September 2020 |archive-url=https://web.archive.org/web/20200921065603/https://www.rand.org/pubs/research_reports/RR4418.html |url-status=live }}</ref><ref name=":1" />

On October 12, 2020, the Electronic Coin Company announced a new [[Nonprofit organization|non-profit]] [[501(c)(3) organization|501(c)3 organization]] called the Bootstrap Project (Bootstrap) in a company blog post titled "ECC’s owners to donate ECC".<ref name=":2">{{Cite web |date=2020-10-12 |title=ECC's owners to donate ECC |url=https://live-electriccoinco-wordpress.pantheonsite.io/blog/eccs-owners-to-donate-ecc/ |access-date=2020-11-08 |website=Electric Coin Company |language=en-US}}</ref> A majority 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.<ref name=":2" /> ECC's blog post claims that nothing will change within the company other than the ownership<ref name=":2" /> including the Board of Directors.<ref name=":2" /> On October 27, 2020, ECC announced that its shareholders have officially voted in favor of donating 100 percent of the company's shares to Bootstrap.<ref>{{Cite web |date=2020-10-27 |title=ECC owners approve donation to Bootstrap Project |url=https://electriccoin.co/blog/ecc-owners-approve-donation-to-bootstrap-project/ |access-date=2020-11-09 |website=Electric Coin Company |language=en-US |archive-date=9 November 2020 |archive-url=https://web.archive.org/web/20201109165654/https://electriccoin.co/blog/ecc-owners-approve-donation-to-bootstrap-project/ |url-status=live }}</ref> On March 30, 2021, the company's transparency report said that it is "now a wholly owned entity of the 501(c)3 Bootstrap".<ref name=":7">{{Cite web|date=2021-03-30|title=ECC Transparency Report for Q3 2020|url=https://electriccoin.co/blog/ecc-transparency-report-for-q3-2020/|url-status=live|archive-url=https://web.archive.org/web/20210330164320/https://electriccoin.co/blog/ecc-transparency-report-for-q3-2020/|archive-date=2021-03-30|access-date=2021-04-02|website=Electric Coin Company|language=en-US}}</ref><ref name=":8">{{Cite web|date=2021-03-31|title=Electric Coin Co. Transparency Report March 2021|url=https://electriccoin.co/wp-content/uploads/2021/03/Transparency-Report-March2021-Final.pdf|url-status=live|archive-url=https://web.archive.org/web/20210402030250/https://electriccoin.co/wp-content/uploads/2021/03/Transparency-Report-March2021-Final.pdf|archive-date=2021-04-02|access-date=2021-04-02}}</ref>

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 an attack a [[Double-spending|51% attack]] where they could potentially manipulate transactions and harm the network. To shield users from the potential fallout, Coinbase swiftly enacted a series of defensive measures, including placing Zcash markets into "limit-only" mode, effectively quelling significant price swings while the situation unfolded. <ref>{{Cite news |date=2023-09-26 |title=Crypto and the Curse of the 51% |language=en |work=Bloomberg.com |url=https://www.bloomberg.com/news/newsletters/2023-09-26/zcash-blockchain-viabtc-mining-pool-concentration-shows-51-attack-risks |access-date=2023-12-24 |archive-date=27 September 2023 |archive-url=https://web.archive.org/web/20230927184355/https://www.bloomberg.com/news/newsletters/2023-09-26/zcash-blockchain-viabtc-mining-pool-concentration-shows-51-attack-risks |url-status=live }}</ref>


The first mining of ZEC is due to commence with the release of the 1.0.0 "Sprout" release on October 28, 2016.<ref>{{Cite web|url=https://z.cash/blog/zcash-launch-and-roadmap.html|title=Zcash Launch and Roadmap|accessdate=2016-10-09|author=Nathan Wilcox|date=2016-08-15|publisher=}}</ref><ref>{{Cite web|url=https://twitter.com/zcashco/status/766055061134843904|title=|accessdate=2016-10-09|author=Zcash Company|date=2016-08-18|publisher=Twitter}}</ref>
{{Day Countdown
|name= First mining
|address=World wide
|year=2016
|month=10
|day=28
|utc_offset=0 hours
}}
== See also ==
== See also ==
* [[Legality of bitcoin by country]]
<!-- Please respect alphabetical order -->
* [[Zerocoin protocol]]
{{Div col}}
* [[Alternative currency]]
* [[SNARK]]
* [[Comparison of bitcoin wallets]]
* [[Digital gold currency]]
* [[Private currency]]
* [[World currency]]
* [[Comparison of payment systems]]
{{Div col end}}


== References ==
== References ==
{{Reflist|30em}}
{{Reflist}}

==External links==
* {{Official website}}


{{Cryptocurrencies|state=expanded}}
{{Bitcoin}}
{{Portal bar|Economics|Free and open-source software|Internet|Numismatics}}
{{Cryptocurrencies}}
{{Authority control}}
{{Authority control}}


[[Category:Cryptocurrency projects]]
{{Portal bar|Cryptography|Economics|Free software|Internet|Numismatics}}
[[Category:Cryptocurrencies]]
[[Category:Application layer protocols]]
[[Category:Application layer protocols]]
[[Category:Software using the MIT license]]
[[Category:Software using the MIT license]]
[[Category:Cryptography]]
[[Category:Cryptography]]
[[Category:Bitcoin]]
[[Category:Private currencies]]
[[Category:Internet properties established in 2016]]

Latest revision as of 12:48, 11 December 2024

This article is about the cryptocurrency Zcash. Not to be confused with Zerocoin or zcache.

Zcash
Denominations
CodeZEC
Development
White paperZcash Protocol Specification
Initial release28 October 2016; 8 years ago (2016-10-28)
Latest release5.7.0 / 13 March 2023; 21 months ago (2023-03-13)[1]
Code repositorygithub.com/zcash/zcash
Development statusActive
Project fork ofBitcoin Core
Written inC++ and Rust (zcashd), Python (zcashd test suite), Rust (zebra), Kotlin (Android SDK), Swift (iOS SDK), Go (lightwalletd)
Operating systemLinux, Windows, macOS
Developer(s)Electric Coin Company (zcashd), Zcash Foundation (zebra)
Source modelOpen source
LicenseMIT (main zcashd code); MIT/Apache (zebra and some support libraries); BOSL (orchard)
Ledger
Hash functionEquihash
Issuance scheduleSimilar to Bitcoin, with "slow start" and different block interval
Block reward3.125 ZEC (80% to miners; 20% is portioned out to a Major Grants Fund (8%), Electric Coin Co (7%), and the Zcash Foundation (5%)), from Canopy upgrade until first halving[2][3]
Block time75 seconds (post-Blossom upgrade)[2]
Block explorerzcashblockexplorer.com
Supply limit21,000,000[2]
Website
Websitez.cash

Zcash is a privacy-focused cryptocurrency which is based on Bitcoin's codebase.[4] It shares many similarities, such as a fixed total supply of 21 million units.[5]

Transactions can be transparent, similar to bitcoin transactions, 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.

Zcash offers private transactors the option of "selective disclosure", allowing a user to prove payment for auditing purposes. One such reason is to make it easier for private transactors to comply with anti-money laundering laws and tax regulations.[6]

Use

Zcash transactions can be transparent, similar to bitcoin transactions, in which case they are controlled by a "t-addr", or they can be shielded and are 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 in the transaction. Zcash coins are either in a transparent pool or a shielded pool. 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.[7] The shielded pool of Zcash coins were further analyzed for security and it was found that the anonymity set can be shrunk considerably by heuristics-based identifiable patterns of usage.[8]

While miners receive 80% of a block reward, 20% is given to the "Zcash development fund": 8% to Zcash Open Major Grants, 7% to Electric Coin Co., and 5% to The Zcash Foundation.[9][10]

History

Development work on Zcash began in 2013 by Johns Hopkins University professor Matthew Green and some of his graduate students.[5] The development was completed by the for-profit Zcash Company, led by Zooko Wilcox, a Colorado based computer security specialist and cypherpunk.[5] In October 2016, The Zcash Company raised over $3 million from Silicon Valley venture capitalists to complete the development of Zcash.[5]

Zcash was first mined in late October 2016.[11] The initial demand was high, and within a week Zcash coins were trading for five thousand dollars a piece.[11] Ten percent of all coins mined for the first four years were to be allotted to the Zcash Company, its employees, the investors, and the non-profit Zcash Foundation.[5]

The setup of Zcash required the careful execution of a trusted setup procedure, something that subsequently became known as "The Ceremony". to create the Zcash private key. In order to ensure privacy, a truly random enormous number needed to be generated to be used as the private key, while also ensuring that no person or computer retains a copy of the key, or could subsequently regenerate the key. If the private key were available, counterfeit Zcash coins could be generated. The Ceremony was a two-day process, executed simultaneously during a short window of time in six different locations globally, by persons who did not know in advance who else was going to be participating in the event. The private key was generated, and used to instantiate Zcash, and the computers used in the process were reportedly destroyed.[12][13] In 2022, Edward Snowden claimed to have participated in The Ceremony under a pseudonym.[14]

On February 21, 2019, the "Zcash Company" announced a re-branding as the Electric Coin Company (ECC).[15]

On May 19, 2020, a paper titled "Alt-Coin Traceability"[16] 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"[8] still 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 Your 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.[17][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.[18][17]

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".[19] A majority 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.[19] ECC's blog post claims that nothing will change within the company other than the ownership[19] including the Board of Directors.[19] On October 27, 2020, ECC announced that its shareholders have officially voted in favor of donating 100 percent of the company's shares to Bootstrap.[20] On March 30, 2021, the company's transparency report said that it is "now a wholly owned entity of the 501(c)3 Bootstrap".[21][22]

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 an attack a 51% attack where they could potentially manipulate transactions and harm the network. To shield users from the potential fallout, Coinbase swiftly enacted a series of defensive measures, including placing Zcash markets into "limit-only" mode, effectively quelling significant price swings while the situation unfolded. [23]

See also

References

  1. ^ "Releases - zcash/zcash". Archived from the original on 18 April 2023. Retrieved 4 April 2023 – via GitHub.
  2. ^ a b c "Frequently Asked Questions - Zcash". Zcash. Archived from the original on 24 June 2019. Retrieved 10 July 2019.
  3. ^ "Canopy". Archived from the original on 17 April 2023. Retrieved 17 April 2023.
  4. ^ "The Basics | Zcash". Zcash. Archived from the original on 9 June 2022. Retrieved 10 July 2020.
  5. ^ a b c d e Popper, Nathaniel (31 October 2016). "Zcash, a Harder-to-Trace Virtual Currency, Generates Price Frenzy". The New York Times. Archived from the original on 11 January 2019. Retrieved 26 January 2017.
  6. ^ Clozel, Lalita (31 October 2016). "How Zcash Tries to Balance Privacy, Transparency in Blockchain". American Banker. Archived from the original on 7 August 2017. Retrieved 24 July 2017.
  7. ^ Quesnelle, Jeffrey (2017). "On the linkability of Zcash transactions". arXiv:1712.01210 [cs.CR].
  8. ^ a b Kappos, George; Yousaf, Haaroon; Maller, Mary; Meiklejohn, Sarah (2018). An Empirical Analysis of Anonymity in Zcash. pp. 463–477. ISBN 978-1-939133-04-5. Archived from the original on 26 April 2020. Retrieved 17 April 2020.
  9. ^ "Zcash development and governance - Zcash". Zcash. Archived from the original on 24 June 2021. Retrieved 22 June 2021.
  10. ^ "Reaching Consensus". Electric Coin Company. Archived from the original on 23 June 2021. Retrieved 22 June 2021.
  11. ^ a b Elaine, Ou (1 November 2016). "Bitcoin Isn't Anonymous Enough". Bloomberg.com. Bloomberg. Retrieved 17 November 2020.
  12. ^ Webster, Molly; Kielty, Matt (25 February 2021). "The Ceremony". Radiolab. National Public Radio. Archived from the original on 28 June 2021. Retrieved 29 June 2021.
  13. ^ "Zcash: Meet Zooko Wilcox, the Man Building a Better Bitcoin | Fortune". 21 December 2017. Archived from the original on 21 December 2017. Retrieved 27 December 2022.
  14. ^ "Edward Snowden says he was the mystery man involved in the creation of leading privacy cryptocurrency Zcash". Fortune. Archived from the original on 2 November 2022. Retrieved 2 November 2022.
  15. ^ "Goodbye, Zcash Company. Hello, Electric Coin Company". Electric Coin Company. 21 February 2019. Archived from the original on 21 October 2020. Retrieved 9 November 2020.
  16. ^ Ye, Claire; Ojukwu, Chinedu; Hsu, Anthony; Hu, Ruiqi (2020). "Alt-Coin Traceability". Cryptology ePrint Archive. Archived from the original on 12 August 2020. Retrieved 27 August 2020.
  17. ^ a b "Introducing Investigation and Compliance Support for Dash and Zcash". blog.chainalysis.com. 8 June 2020. Archived from the original on 16 September 2020. Retrieved 5 September 2020.
  18. ^ Silfversten, Erik; Favaro, Marina; Slapakova, Linda; Ishikawa, Sascha; Liu, James; Salas, Adrian (6 May 2020). "Exploring the use of Zcash cryptocurrency for illicit or criminal purposes". Archived from the original on 21 September 2020. Retrieved 5 September 2020.
  19. ^ a b c d "ECC's owners to donate ECC". Electric Coin Company. 12 October 2020. Retrieved 8 November 2020.
  20. ^ "ECC owners approve donation to Bootstrap Project". Electric Coin Company. 27 October 2020. Archived from the original on 9 November 2020. Retrieved 9 November 2020.
  21. ^ "ECC Transparency Report for Q3 2020". Electric Coin Company. 30 March 2021. Archived from the original on 30 March 2021. Retrieved 2 April 2021.
  22. ^ "Electric Coin Co. Transparency Report March 2021" (PDF). 31 March 2021. Archived (PDF) from the original on 2 April 2021. Retrieved 2 April 2021.
  23. ^ "Crypto and the Curse of the 51%". Bloomberg.com. 26 September 2023. Archived from the original on 27 September 2023. Retrieved 24 December 2023.
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