What Is Zcash
Zcash was founded in October 2016 by a team of scientists led by Zooko Wilcox-O'Hearn. ZEC coin was created as a decentralized and open-source cryptocurrency that offers privacy and security for users' financial history.
ZEC is built on Bitcoin's original codebase. Zcash network employs zero-knowledge proofs (ZKPs), one of the most innovative cryptographic primitives available today, to accomplish near-total privacy for private transactions. Specifically, Zcash uses an optimized form of ZKPs known as zk-SNARKs, along with shielded transactions that obfuscate transaction details across its public blockchain network, providing anonymity and fungibility.
Zcash also offers the option to send money via transparent transactions, using unshielded or transparent addresses for sending payments.
ZEC price will highly depend on fundamental factors. Despite mixed forecasts, Zcash seems to be a good investment regarding its privacy feature. Zcash is also the first open-source digital asset based on a blockchain.
Zcash Founders
In 2013, Matthew Green, Ian Miers, and Christina Garman from Johns Hopkins University came up with Zerocoin, a proposed privacy extension to Bitcoin. The team later recruited additional scientists to build Zcash. The Zerocoin Electric Coin Company (now Electric Coin Company) was formed in 2015 and led by its founder Zooko Wilcox-O'Hearn to help engineer and deliver the idea. The Zcash Foundation was launched in 2017 to ensure the network's continued development.
Zooko Wilcox-O'Hearn has spent over 25 years working in the information security (InfoSec) industry using cryptographic tools to maintain network integrity. The computer security expert has taken a role in multiple blockchain projects, including the Tahoe Least-Authority file system, data storage program Mojo Nation, and the now-defunct electronic cash company DigiCash.
He is also the founder of Least Authority Enterprises, a digital information security firm dedicated to preserving the fundamental human right to privacy and helping to co-invent the BLAKE3 hash function.
Zcash Usage / Zcash Price
Users who want to run a node or transact on the Zcash network need the appropriate Zcash software. The primary use for Zcash currently is moving value on ZEC's L1 Network. Zcash is also attractive because of ZEC's ability to transfer funds privately and keep personal financial information hidden with the native ZEC tokens. Additionally, ZEC can be used as a speculative investment tool and a form of payment.
Zcash does not support staking; instead, it utilizes a proof-of-work (PoW) consensus. Zcash's algorithm is called Equihash, and it requires the use of custom-designed ASIC miners to be mined efficiently. Most users opt to lend their computational power to a mining pool to receive regular rewards.
Following the Canopy Upgrade in late 2020 that replaces the Founders Reward, ZEC miners will continue to receive 80% of the block rewards. The remaining 20% will be divided among the new Major Grants Fund (8%), ECC (7%), and the Zcash Foundation (5%).
Ledger and Trezor hardware wallets offer storage solutions for ZEC.
Zcash Network Security
Zcash network security is maintained by a proof-of-work consensus mechanism. Zcash miners secure the network by solving computationally difficult puzzles to produce blocks. As long as every miner or node agrees on the order in which the blocks have been produced, the state of all the information is recorded, and the network proceeds to the next block. This consensus mechanism prevents attacks by requiring malicious actors to control a large portion of the network. The objective of proof of work is to extend the chain, and miners are incentivized to continue to do this work on the Zcash chain.
Zcash allows users to send transactions through the network efficiently, easily, and with low fees. Zcash offers two types of addresses: transparent addresses sent from public addresses that are publicly visible on the Zcash blockchain and shielded addresses that are private. Zcash users who may want additional privacy can take advantage of Zcash's shielded transactions. Zcash payments sent from a shielded address to a transparent address reveal the received balance, while payments from a transparent address to a shielded address protect the receiving value.
These transactions are only possible due to the use of Zero-Knowledge Proofs or Zk-SNARKs that allow transactions in ZEC to be fully encrypted on the blockchain but still verifiable as valid transactions. They allow a user to prove possession of a secret key without revealing that information and without any additional transactions between the two parties.
