Zcash

Zcash, also known as ZEC, is categorized as a privacy cryptocurrency as it features cryptography as a way of assuring anonymity to its users and their transactions.

Zcash employs “shielded addresses” which allow for the encryption of transaction and address data stored on its blockchain. It also has a customizable setting of anonymity by offer of two possible address types: transparent addresses and shielded addresses, and while former will appear on the blockchain, the latter will not.

This means that a user who chooses a shielded address will not have his or her transaction data linked back to him or herself while on display on the blockchain.

The Inner Workings of Zcash

Zcash’s operates on zk-SNARK, a powerful cryptographic tool which allows for any user who is in possession of private data to convince someone who is seeking to verify it that this data is, in fact, true. This is done without revealing nothing but a true or false statement.

Zk-SNARK ensures that whoever is verifying learns only that the data is true or false, but also that the proof is made small enough in sized and verified in milliseconds without having any communication between whoever is verifying it and whoever is proving it. As such, no prover can prove information unless there is verifiable information to prove and no prover can make someone accept false information.

The History Behind Zcash

Zcash launched in 2016 and enabledcutting-edge cryptography. Its history, however, can be traced back to 2013, specifically to the publication of the Zerocoin white paper, a document in which many cryptographers and academicsargued that Bitcoin compromised user privacy and offered new solutions to address the issue.

Zerocoin was designed to be implemented in Bitcoin but its very complex changes were overwhelming. Cryptographer Zooko Wilcox took notice and in 2015 founded his own company with the goal of exploring those very same concepts and creating a new cryptocurrency. Zcash was announced the following year.

The Zcash blockchain drew from those ideas and was designed in a completely different way from other cryptocurrencies.

Its design process, often referred to as “Zcash ceremony” or “Zcash trusted setup” required its creators to trust whoever so wanted to cooperatively create a master public key in the blockchain by means of using smaller shards of private keys.

Later on, all participants were to destroy the remaining data as to prevent it from being manipulate in the future, something which added a bit of controversy to it, as no one will be able to prove that the process was conducted as intended.

The non-profit Zcash Foundation supports a large team of cryptographers (the Electric Coin Company) which further develops its blockchain.