What is Zcash (ZEC)?
Future of ZEC Cryptocurrency and know how to buy ZEC

#1 - What is Zcash?

Zcash: The Basics

Cryptocurrencies may be taking the world by storm, but they’ve also brought with them some unexpected issues - a public blockchain allows everyone to peer into our wallet transactions and balance. Understandably, many are not pleased with such features in a blockchain. That’s where Zcash comes in. 

The creator of Bitcoin - Satoshi Nakamoto - had noted that there was an increase in the demand for coins which provide better privacy. He wasn’t wrong. 

ZEC Development

  1. As a cryptocurrency, Zcash offers significantly improved privacy for its users compared to its counterparts.
  2. It was developed from the scientific Zerocoin protocol, which was enhanced to form the Zerocash system. This subsequently developed into the Zcash cryptocurrency by the Zerocoin Electric Coin Company, also referred to as the Zcash Company.
  3. Zcash developed and improved the protocol and the reference implementation.
  4. Zooko Wilcox-O'Hearn is the founder and CEO of Zcash company. Cryptographer Matthew D. Green from Johns Hopkins University was part of the founding team and Roger Ver was one of the company’s initial investors. 

ZEC Technology 

  1. The Zcash cryptocurrency uses a technology called zero-knowledge cryptography, which allows Zcash to protect the privacy of the transaction.
  2. Like Bitcoin, it exposes the entire payment history to the public, which is published on the public blockchain, but users can choose an optional privacy feature. This allows them to conceal the important details.
  3. Zcash aims to protect the details about the sender, recipient and the value using shielded transactions. In the niche segment of privacy coins, Zcoin competes with other privacy coins like PivX, Montero, Verge etc. Zcash has a fixed total supply equivalent to  21 million bitcoins. 

 

#2 - What are the Benefits of Zcash?

The Zcash coin is a decentralized and an open source cryptocurrency, which provides and offers users with the selective transparency of their transactions. The peer to peer cryptographic research on which the Zcash technology is based is developed from the battle-tested Bitcoin Core’s codebase. It is developed by a team specializing in security engineering.

  1. Zcash uses a cryptographic concept known as zero-knowledge proofs, which guarantees the validity of the transaction but without revealing the information regarding the sender, recipient or the value of the transaction.
  2. The zero-knowledge proofs used for Zcash are known as zk-SNARKs. zk-SNARK stands for “Zero-Knowledge Succinct Non-Interactive Argument of Knowledge,” which is basically a form of proof construction to prove possession of certain information like a secret key without actual interaction between the prover and the verifier. 

 

A Zcash transaction includes:

  • The sending address,
  • receiving address,
  • account balance and
  • A transaction fee.

In a transaction, both the sending and receiving addresses are shielded and for this generation of zero-knowledge proof is required for verifying the transaction’s encrypted data without it actually being revealed. These addresses are referred to as “z-addrs” and always start with a “z”.

In the same way, transparent addresses require an interaction with “Transparent Value Pool” (or TVP) and publicly reveals transaction data. These addresses are called “t-addrs” and always start with a “t”. The unique value proposition of Zcash is that it significantly increases the privacy of the user by using technology like Zk-Starks and zero-knowledge.

 

#3 - How to buy and store Zcash

  1. ZEC can be stored using the official Zcash wallet that comes in both the mobile application and desktop forms.
  2. Once you have set up and verified your wallet, you can start funding your account. This can be done through Bitcoins or on some platforms through other cryptocurrencies as well. Once the account has been funded, you can go and buy your ZEC.
  3. On crypto exchanges, you can buy ZEC through bitcoins. CoinSwitch, the largest cryptocurrency exchange lets you view the best exchange rates across multiple exchanges at once. This allows users to pick their desired rates and get the most value on their transactions. 

What’s more - with CoinSwitch, you do not rely on a separate wallet from the exchange to store your ZEC coins. Instead, all transactions happen to and from your own personal private wallets.

This way, if you have a prior investment in multiple cryptocurrencies, you can check out the cheapest buy for Zcash. With increasing focus on privacy and anonymity, it is important to search for a secure wallet for cryptocurrencies. Multiple kinds of Zcash wallets are being used all across the world, including new high-security hardware wallets, like the ledger nano. Almost all other crypto exchanges support Zcash since it has become the choice of Altcoin for most due to its tight security.

 

#4 - What is the future of Zcash?

Like most cryptocurrencies, the Zcash coin has also shown a huge amount of volatility since its inception into the market on October 28th, 2016.

  1. It was launched at a price of $4,293.37. Within two months its price declined by 98.8% to $49.
  2. In 2017, its price witness an increase of 1,108%, typical of the volatility that is characteristic of the cryptocurrency market.
  3. In 2018, it touched its peak of $876.31 during the first week of January but then slumped by 48% YTD as of May 14, 2018, following the general market trend. But according to most industry experts, it has a bright future.

Support & Regulation

  1. Zcash has received a confident backing from its investors and has also tied up with several Industry powerhouses like JPMorgan Inc.
  2. Grayscale investment predicts its value would touch close to $60,000 by the year 2025. [1]
  3. Financial major JPMorgan Inc. (JPM) has set up a partnership with Zcash and aims to use its technology for Quorum, an enterprise-ready distributed ledger, and smart contract platform.[2] It can also use be used to pay their medical bills without actually showing its content. 

The two primary reasons for such an enthusiastic estimate are: 

  1. Firstly the similarity between the economic model of bitcoins and Zcash, so that Zcash can act as a store of value;
  2. Secondly, because of the huge emphasis on privacy which would become one of the mainstays of future cryptocurrencies. 

Also Read:  Complete Analysis of Zcash | Live Zcash (ZEC) Price Charts & Predictions

#5 - How is Zcash different from other cryptocurrencies?

  1. When the cryptocurrency market boomed, its biggest USP was anonymity. However, anonymity could not hide the transactions that were put up on the public blockchain ledger.
  2. In 2016, the world of cryptocurrencies got its completely private cryptocurrency in Zcash. It allowed private transactions on a public blockchain. This can be done using the option of shielded transactions. 
  3. However, despite these major advantages, the idea of Zcash overtaking some other cryptocurrencies seems a little far fetched. With respect to Bitcoin, the primary field in which ZEC outshines bitcoin is in privacy. However, in all other major fields – exchanges, wallets, prices, liquidity and backing development team, Bitcoin is still the better option. Security and privacy of online users are maintained by Zcash through the zero knowledge protocol. Both Bitcoin and Litecoin have overlooked ‘complete’ anonymity when it comes to transactions which are now being fulfilled by Zcash. However, it is a little difficult for regular users to mine the Zcash coin due to its asymmetric memory driven algorithm in comparison with bitcoin and even Litecoin.
  4. Comparing Zcash with Ethereum would be a little difficult since their goals happen to be very different. Zcash has complete focus on privacy while Ethereum is trying to get rid of additional and intermediate costs during transactions. In fact, Zcash and Ethereum aim to work together to allow top level privacy on an Ethereum like blockchain.

 

#6 - Should you invest in Zcash?

The controversial nature of Zcash often leaves us wondering whether it will last. Complete decentralization with no legal liabilities and zero government backing often leaves people with their doubts. However, it does have all the aspects of a strong cryptocurrency – fast transaction processing, additional privacy measures and an active development team.

  1. Zcash also has backing from several leading blockchain investors and some interesting partnerships including one with JP Morgan. This makes Zcash a very robust cryptocurrency to invest in.
  2. Theoretically, it has not been built to fail and going by current trends, Zcash is well positioned to continue to gain value.
  3. However, the risks lies with high inflation factor over the next five years and the trusting set up it has created. It seems to be the best time to invest in Zcash now. It seems to be riding on its initial gains and investors are making huge profits.

Zcash continues to witness rallies at multiple points. Where it is headed in the future is anyone’s guess, but many would agree that the direction is upwards. Especially in the context of the privacy concerns the world is waking up to in today’s age.

Frequently Asked Questions (FAQs)

Q. What is Zcash used for?

A. Zcash is aimed at providing enhanced privacy for its users and uses Zero-knowledge proofs to encrypt all the information between users. Zcash provides both transparent and confidential transactions.

Q. What is Zcash mining?

A. Zcash transactions are verifiable by the Equihash mining protocol which ensures that no double-spending takes place. Zcash mining is the process by with ZEC transactions are verified and added to the blockchain and the miner in return gets newly generated Zcash coins.

Q. Is Zcash decentralized?

A. Yes, it is a decentralized privacy-based cryptocurrency.

Q. How is Zcash anonymous?

A. Zcash is only fully anonymous when sending between two z-address.

Q. How much Zcash are there?

A. As of August 27, 2019, there are 7,281,844 ZEC.

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