What is Zcash? A Private Security Layer Based on Bitcoin
What is Zcash?
Zcash is a publicly encrypted blockchain and scientific breakthrough in cryptography by using zero-knowledge cryptography known as zk-SNARKS. This framework allows the user to leverage two addresses: one fully private and one transparent (similar to Bitcoin).
Known as shielded and transparent, respectively, these customizable modes allow your transaction to be completely anonymous or publicly viewable.
Zcash shields your and the recipients’ transaction (making it anonymous or transparent)
Max Supply: 21,000,000
Current Circulating Supply: 3,006,856
Algorithm: Equihash (aimed at creating ASIC resistance through high RAM requirements)
Proof Type: Proof of Work (PoW)
ZCash is significant because it provides a secure transportation layer for our data (and ultimately identities), it’s the “http” of money. Imagine an armored car which houses your data in a box. The security from the vehicle protects viewing the contents of the box as well as providing safe passage for the data.
With Bitcoin, our data is being transported in clear glass car allowing anyone to see the contents inside of the car. This means would be observers, thieves or other bad actors would have the ability to see what you have in the vehicle whether amounts of funds or receiver’s of funds.
zk-SNARKS is a scientific breakthrough in cryptography allowing an action to be proven without revealing all the details of the particular action. (Before someone would have to re-create and re-test the inputs you used)
Standing for zero-knowledge Succinct Non-interactive Arguments of Knowledge (zk-SNARKs), this mathematical proof construct ensures that all information (sender, receiver, and amount) is encrypted while also preventing double-spending (a critical element to successful cryptocurrency architecture).
Private transactions can be made viewable through “selective disclosure” function
Transactions have a memo field which could be used to send additional transaction data viewable only to recipients. This memo could be set up in a customized way as required by industry, regulatory compliance or other legal authorities.
A concrete example of this would be to share that you have at least a million dollars in your account (without revealing your total account balance). Another would be showing that you possess the wallet’s private keys and in effect the ability to spend (like a controller).
The dark side of Bitcoin’s transparency
An odd negative outcome of Bitcoin’s transparency is that savvy criminals can gain some anonymity (through coin mixers and IP cloaking) while your average innocent user gets no privacy. Because anonymity is not built-in, most users will not change the default settings. This creates vulnerabilities as would be attackers could cherry pick the highest value victims (and who they paid) by seeing who has the most money.
On the enterprise side, a business must protect confidential information from competitors, customers and even suppliers. Employers might want payroll kept secret from other employees and rivals. These trade secrets are not insignificant and the utility of protecting them shouldn’t be underestimated.
Who is behind Zcash?
The founding team of Zcash, coding the future of private, secure money
The Zcash team is a mish-mash of scientists, engineers, designers and business pros from across the globe including MIT, Johns Hopkins and Tel Aviv University. Developer team members include: Eli Ben-Sasson, Alessandro Chiesa, Christina Garman, Matthew Green, Ian Miers, Eran Tromer, and Madars Virza
“This is the first protocol of its kind. It is the product of years of scientific research, advanced engineering, and diligent security work…We encourage the Zcash community to experiment with us, and to mine, run a node, and join the growing and friendly community. Zcash is a consensual currency, a community network, and developer-supported cryptocurrency; your active participation makes the network stronger.”
-Zooko Wilcox, CEO and Founder of Zcash
There was no crowd sale or ICO for Zcash but rather private investments from renowned individuals like Naval Ravikant (Angel list founder), Roger Ver (early Bitcoin investor), Erik Voorhees (Shapeshift founder), Barry Silbert (Digital Currency Council founder) and Fred Ehrsam (founder of Coinbase).
Where can I buy Zcash (ZEC)?
Bittrex and Poloniex are among the top two exchanges with high volume and liquidity.
How to store Zcash?
For a mobile, light client you can use Coinomi.
Privacy, why do we need it?
Companies like Google and Facebook have crafted very profitable businesses from our data. Max Schrems, a privacy activist, requested the information Facebook had on him for a thesis paper and received a 1,200-page character profile across 57 categories.
There’s a whole data world out there and most people are unaware of how it works or is being used against us. Zero-knowledge proofs and projects like Zcash protect us from the purview of age-old institutions while paradoxically offering compliance with the rules and regulations imposed by those same authorities today.
The promise of privacy-focused cryptocurrencies and new security layers like Zcash and zk-SNARKS are a refreshing reminder of important often overlooked needs in an increasingly centralized and data-driven world.
Ever since the cryptocurrency fad caught on, governments across the world have struggled to regulate them, especially after Bitcoin’s price explosion last year. The upward spike and outrageous profits led…
ABOUT THE AUTHOR
ABOUT THE AUTHOR
Aaron has spent 10+ years in different start-up, business environments wearing hats in marketing, sales, management and operations.
After doing business development and content marketing for a Silicon Valley IT and Cloud services firm, Aaron realized how technology is transforming everything we do in our personal and professional lives.
This prompted a deeper professional interest in the Bitcoin and Blockchain space which he had been dabbling in since 2014 as a miner and trader.
Aaron now writes about Blockchain Technologies and does content marketing and business development for CoinStructive, a Bitcoin and Blockchain consulting firm.