Zcash#History

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{{Infobox cryptocurrency

| symbol =

| ticker_symbol = ZEC

| currency_name = Zcash

| image_1 = Zcash logo (2024–present).svg

| image_2 =

| image_width_1 = 120px

| image_title_1 =

| 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{{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 }}

| circulating_supply =

| supply_limit = 21,000,000{{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 }}

| 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}}{{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 }}

| project_fork_of = Bitcoin Core

| programming_languages = C++ and Rust (zcashd), Python (zcashd test suite), Rust (zebra), Kotlin (Android SDK), Swift (iOS SDK), 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)

| operating_system = Linux, Windows, macOS

| author =

| developer = Electric Coin Company (zcashd), Zcash Foundation (zebra)

| source_model = Open source

| license = MIT (main zcashd code); MIT/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}}

}}

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

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 users 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.{{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 }}

Use

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. 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.{{Cite arXiv |eprint=1712.01210 |class=cs.CR |first=Jeffrey |last=Quesnelle |title=On the linkability of Zcash transactions |date=2017}} 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.{{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 }}

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.{{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}}{{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}}

History

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

Zcash was first mined in late October 2016.{{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 }} The initial demand was high, and within a week, Zcash coins were trading for five thousand dollars a piece. 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.

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. 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 would 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.{{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 }}{{Cite web |date=2017-12-21 |title=Zcash: Meet Zooko Wilcox, the Man Building a Better Bitcoin {{!}} Fortune |work=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 }} In 2022, Edward Snowden claimed to have participated in The Ceremony under a pseudonym.{{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 }}

On February 21, 2019, the "Zcash Company" announced a rebranding as the Electric Coin Company (ECC).{{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 }}

On May 19, 2020, a paper titled "Alt-Coin Traceability"{{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 }} 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" 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.{{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 }}{{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.{{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 }}

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".{{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}} 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. ECC's blog post claims that nothing will change within the company except the ownership, including the Board of Directors. On October 27, 2020, ECC announced that its shareholders had officially voted to donate 100 percent of its shares to Bootstrap.{{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 }} On March 30, 2021, the company's transparency report said it is "now a wholly owned entity of the 501(c)3 Bootstrap."{{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}}{{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}}

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. Coinbase swiftly enacted a series of defensive measures to shield users from potential fallout, including placing Zcash markets into "limit-only" mode, effectively quelling significant price swings while the situation unfolded. {{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 }}