This article will talk about the coin Edward Snowden and Wikileaks employees called the most interesting altcoin. We will speak about Zcash, its features, team, liquidity markets, and prospects.
Who Developed Zcash?
Four groups of blockchain engineers created the Zerocash protocol. They came from Tel Aviv University, Johns Hopkins University, Technion, and MIT.
The Zcash network started its work on October 28, 2016. The executive director is a computer security specialist from the US, Zooko Wilcox. The team includes programmers, engineers, designers, scientists, lawyers, financiers. The list of project consultants also includes the creator of Ethereum, Vitalik Buterin.
How Does the Zcash Network Work?
One of the main principles of cryptocurrencies is anonymity. But the vast majority of coins, as well as Bitcoin, are so-called “pseudo-anonymous,” in fact. The blockchain is public so that anyone can track transactions.
The Zcash ecosystem is based on the Proof of Work algorithm. Miners are responsible for processing transactions and generating new blocks. Their computing equipment supports the blockchain network operation. Thus, they get rewards in crypto. Zcash mining has long been possible only on specialized devices. It takes about 1.25 minutes for new block creation.
The hashing algorithm used for mining Zcash is called Equihash. Programmers Alex Biryukov and Dmitry Khovratovich developed it based on the computing theory. When creating the Zcash algorithm, they focused on protecting cryptographic hash functions from the “Birthday Problem” collision and other potential blockchain vulnerabilities.
In late 2019, at block 653,600, a network update in the Zcash ecosystem occurred under the code name Blossom. Its implementation reduced the block generation time to 75 seconds and increased the network bandwidth. At the same time, the block reward dropped to 6.25 ZEC, while the processing fee remained the same.
The creators of the Zcash cryptocurrency plan to add support for sharing technology. Then, the system will be able to process “thousands or even millions of financial transactions per second.” However, an implementation may require a drastic change in the entire blockchain ecosystem. And then, the period of using open addresses will most likely be over. The new chain will be really fast and anonymous.
How to Buy ZEC Cryptocurrency?
The coin is available on the largest popular exchanges. To trade on centralized platforms, you need to register an account. To use traditional money there, you have to pass identity verification.
How to buy a cryptocurrency and remain incognito at the same time? The easiest and fastest way to buy ZEC is the Godex.io platform. To trade, you don’t even need to register, and your personal data is not required. You will see Zcash to Bitcoin converter on the homepage. There, you can create an exchange request in a couple of steps. The order takes 5-30 minutes, depending on the network load.
Distribution of Bonuses for Found Blocks
In January 2020, the Zcash community voted. A new scheme for distributing mining rewards in the ecosystem was on the agenda. They decided the following:
- Miners will still get 80% of the bonus for each block found.
- Employees of the Electric Coin Company ‒ the focal point of developing the Zcash cryptocurrency ‒ will receive 7%.
- Another 5% will go to the Zcash Foundation.
- They decided to use the remaining 8% of the awards to create grants. It will help attract third-party programmers.
Thus, they introduced a new structure for the distribution of payments in the fall of 2020. The Canopy update changed the distribution of block rewards and was introduced together with halving. On block 1,046,400, the reward dropped from 6.25 ZEC to 3.125 ZEC.
This update was a significant event for the Zcash community. Previously, 20% of the reward bonuses were distributed between ECC founders and investors. This distribution caused a lot of controversy in the community.
Thus, the innovations affected the founders and employees of ECC. As of fall 2020, they no longer receive the award. At the same time, the share allocated to the Zcash Foundation has increased. According to Zcash management, external developers’ involvement is necessary to ensure integrity, greater decentralization, and further development of the protocol.
Conclusion
Zcash has a strong development team, a large community, and unique technologies. It is a solid argument in favour of the successful growth of the ecosystem. However, the tough position of the regulators does not allow the project to reach its full potential. Many experts believe that Zcash could be among the most famous crypto assets in the long term. Even Vitalik Buterin admitted that he holds several more coins in his crypto portfolio besides ETH: Bitcoin Cash, Dogecoin, and Zcash.