ZCash: What it is, Why it was Created, How to Mine it

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What Is ZCash (ZEC)?

ZCash emerged in 2016 when a group of scientists decided they wanted to create a cryptocurrency similar to Bitcoin but with some additional features. They developed a fork of the Bitcoin blockchain, with enhanced user security and anonymity. The scientists first invented Zerocoin, which became Zerocash not too long after its initial release. Eventually, the cryptocurrency was renamed ZCash.

Key Takeaways

• ZCash is a Bitcoin fork with a different hashing algorithm and security protocols.
• ZCash started as Zerocash; it was later improved upon by the Electric Coin Company and rebranded ZCash.
• ZCash verifies ownership of coins and transactions more anonymously than Bitcoin, thus providing more security for users.
• Zcoin can be mined on devices and computers, but the currency is best mined on dedicated systems called application-specific integrated circuits.

Understanding ZCash (ZEC)

ZCash is forked from the original Bitcoin codebase. In 2014, Eli Ben-Sasson, Alessandro Chiesa, Christina Garman, Matthew Green, Ian Miers, Eran Tromer, and Madars Virza believed there were security flaws in the way transactions were tracked through Bitcoin’s blockchain. In their whitepaper outlining their ideas, they called their cryptocurrency Zerocash.

The scientists created Zerocoin (Electric Coin Company) in 2015. In 2016, the name changed to Zcash, by the Electric Coin Company.

ZCash uses the zk-SNARK security protocol to ensure the parties involved in a transaction are verified without revealing any information to each other or the network.

ZCash is an altcoin, a category of cryptocurrency that shares many of the characteristics of Bitcoin. Many altcoins are different in their purpose and intended uses.

Zk-Snark allows for fully shielded transactions in which the sender, recipient, and amount are encrypted. This feature is a large deviation from other cryptocurrencies, where transaction transparency is an underlying concept aside from securing user information.

How Is ZCash Different from Bitcoin?

The Bitcoin community prides itself on transparent transactions while maintaining anonymity. However, anyone interested or who has a stake in a transaction could trace the parties within it.

ZCash doesn’t eliminate transaction information. Instead, it encrypts it so that it cannot be tracked. The ZCash blockchain is still encrypted, but the security protocol zk-SNARK adds additional user security and anonymity.

Bitcoin uses the hashing algorithm SHA-256. ZCash uses Equihash, which is incompatible with hardware and software designed for Bitcoin mining. It also has larger blocks and increased hashing times, which increases the network’s hash rate. A cryptocurrency’s hash rate is the processing power of the network of miners—it’s a measure of how fast the transactions can be verified and validated to open a new block.

Joining a mining pool is one of the best ways to benefit from ZCash mining. Efficiency and opportunities to earn are increased when resources are pooled together.

Hashing is the process used to convert data into a string of alphanumeric characters. The string of numbers is unique because it is created from the data in the block. Once hashed, it cannot be replicated. The hashing algorithm is the mathematical method used to create the alphanumeric string, also called the hash.

Goals of ZCash

ZCash was designed to be efficient, safe, and anonymous. The developers behind ZCash also promote complying with regulatory requirements. Additionally, you can choose full transparency when you use ZCash, in which case its transparency is similar to that of Bitcoin when transfers are conducted.

How to Mine ZCash

New coins are produced by mining. You can use an application-specific integrated circuit (ASIC) miner or your computer if it has a graphics card capable of mining. Operating systems supported by ZCash are Docker, Debian/Ubuntu, Mac, and other Linux flavors. However, ZCash recommends using an ASIC miner and mining pool because the network difficulty has gotten high enough that PC mining is not worth the time and costs.

ZCash uses a proof-of-work mining algorithm, which requires miners to compete against each other to produce a new block by racing to solve the hash. The first miner to find the solution opens a new block and receives the block reward.

How Many ZCash are Left?

ZCash has a maximum supply of 21 million coins, with 14.6 million in circulation. Once there are 21 million ZCash in circulation, no more can be mined, and you’ll only be able to acquire them by purchasing them on an exchange or from an individual.

Is ZCash Safe?

ZCash is safe in the sense that it hides and protects your information.

Does ZCash Use Proof of Work?

Yes, it uses Equihash, a proof-of-work mining algorithm based on the Generalized Birthday Problem concept.

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Breaking down everything you need to know about Bitcoin mining, from blockchain and block rewards to proof of work and mining pools.

A nonce is an encrypted number uniquely identifying a block in a blockchain. Miners rush to decipher the nonce to generate new blocks, confirm transactions, and enhance network security.

Bitcoin (BTC) is a digital or virtual currency created in 2009 that uses peer-to-peer technology to facilitate instant payments.

Block time, in the context of cryptocurrency, is the average amount of time it takes for a new block to be added to a blockchain.

Hash rate is the measure of the computational power in a proof-of-work (PoW) cryptocurrency miner, pool, or network. High hash rates equal better odds of winning.

“Difficulty bomb” referred to the increasing difficulty and time needed to mine Ethereum blocks to discourage a fork after the blockchain transitioned to proof-of-stake.

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Ціна Zcash

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Zcash новини

Про Zcash

Що таке Zcash (ZEC)?

Zcash – це децентралізована криптовалюта, орієнтована на конфіденційність та анонімність. Вона використовує технологію zk-SNARK з нульовим розпізнаванням, яка дозволяє вузлам мережі перевіряти транзакції, не розкриваючи будь-якої конфіденційної інформації про ці транзакції.

Всупереч поширеному непорозумінню, більшість криптовалют на ринку, включаючи Bitcoin (BTC), не анонімні, а псевдонімні; хоча вони і явно не розкривають особистості своїх користувачів, але кожен користувач має власну публічну адресу або адреси, які можна відстежити за допомогою методів науки про дані та криміналістичної експертизи блокчейну.

З іншого боку, трансакції Zcash все ще мають передаватися через загальнодоступний блокчейн, але на відміну від псевдонімних криптовалют, транзакції ZEC за замовчуванням не розкривають адреси відправлення та отримання або суму, яка надсилається. Однак є можливість розкрити ці дані для цілей аудиту або відповідності нормативним вимогам.

Zcash вперше був випущений 28 жовтня 2016 року, і спочатку він був заснований на кодовій базі Bitcoin.

Хто заснував Zcash?

Zcash був заснований у 2016 році cypherpunk, експертом з комп’ютерної безпеки та підприємцем Зуко Вілкокс-О’Хірн (Zooko Wilcox-O’Hearn). Він також є засновником комерційної компанії Electronic Coin Company (ECC), яка керує розвитком Zcash.

Wilcox-O’Hearn провів більше 25 років у галузі криптографії та інформаційної безпеки та зробив внесок у низку проектів, включаючи нині неіснуючу фірму електронних грошей DigiCash, однорангове програмне забезпечення для зберігання даних Mojo Nation та Файлова система сховища файлів з найменшими повноваженнями Tahoe.

Він також заснував Least Authority Enterprises, технологічну компанію, зосереджену на покращенні цифрової безпеки та збереженні фундаментального права на конфіденційність, а також винайшов криптографічну хеш-функцію BLAKE3.

Що робить Zcash унікальним?

Основна перевага Zcash полягає у його необов’язковій анонімності, яка забезпечує рівень конфіденційності, недосяжний для звичайних псевдонімних криптовалют, таких як Bitcoin або Ethereum.

Трансакції ZEC можна надсилати двома способами: прозорим і захищеним. Прозорі транзакції працюють приблизно так само, як і у Bitcoin, кодова база якого спочатку була заснована на Zcash: вони пересилаються між публічними адресами і записуються у незмінний публічний реєстр (блокчейн). Вся важлива інформація про ці трансакції доступна в Інтернеті для будь-кого, включаючи адреси відправлення та отримання та надіслану суму.

Ці публічні транзакції не розкривають ідентифікаторів користувачів у відкритий спосіб: єдині ідентифікатори, до яких сторонній спостерігач може отримати доступ із блокчейну – це публічні адреси. Однак, протягом останніх років зусиллями науковців з даних і правоохоронних органів методи аналізу блокчейну були розроблені до такої міри, коли зацікавлена сторона може досить надійно зв’язати публічну адресу в блокчейні з реальною особистістю її власника, по суті, унеможливлюючи приватні операції.

Захищені транзакції ZEC, з іншого боку, використовують технологію стислих неінтерактивних аргументів знання з нульовим знанням, або zk-SNARKs, щоб дозволити повністю анонімні транзакції надсилатися через загальнодоступний незмінний блокчейн. Той факт, що транзакція _відбулася, записується у книзі, але адреси відправлення та отримання та надіслана сума не розкриваються для громадськості.

Це дозволяє Zcash запропонувати своїм користувачам право на конфіденційність, користуючись перевагами децентралізованої цифрової валюти без дозволу.

Скільки монет Zcash (ZEC) у обігу?

Загалом, токеноміка Zcash подібна до Bitcoin: це рідкісний токен, який можна майнити, із загальним обмеженням пропозиції у 21 мільйон монет.

Нові ZEC створюються у формі «субсидії блоку»: щоразу, коли майниться новий блок та додається у кінець блокчейну, певна кількість монет карбується і розбивається на «субсидію майнера» та « винагороду засновників» у співвідношенні 80 до 20 відсотків відповідно. Блокова субсидія через регулярні проміжки часу зменшується вдвічі, щоб уповільнити темпи випуску, оскільки загальна пропозиція ZEC наближається до своєї межі у 21 мільйон.

Субсидія майнера надходить майнеру, який видобув останній блок, а винагорода засновників розподіляється між засновниками Electronic Coin Company (ECC), Zcash Foundation і самою ECC, а також її співробітниками. Станом на жовтень 2020 року, блокова субсидія дорівнює 6,25 ZEC.

Як захищена мережа Zcash?

Мережа Zcash захищена хеш-функцією підтвердження роботи proof-of-work SHA-256, яка належить до набору алгоритмів SHA-2 — так само, як і Bitcoin.

Де можна купити Zcash (ZEC)?

Zcash – це першокласна криптовалюта. Купити Zcash можна на кількох основних біржах, деякі з яких:

What Is ZCash? The Complete ZCash Review

So, you’ve probably heard about Zcash, however, you’re not sure how it works or how it can be used? Well, you’ve come to the right place to learn more!

By the way, did you know that ZCash was once called Zerocoin?

Anyway, this “What is ZCash?” guide is going to tell you everything you need to know. First, I will give you some background information about ZCash. Then I will tell you how it can be applied in the real world.

After that, I will explain ZCash’s technology in a really simple way, and its potential to either rise or fall in value over time.

Before moving further, you should know that it’s important to choose a reliable cryptocurrency exchange (such as Kucoin) when buying Zcash. Also, to keep it secure, you’ll need a safe wallet. You should definitely consider Ledger Nano S Plus and Trezor Model T.

I hope you’re ready to be educated. Let’s get started!

Looking for the most secure place to buy BTC? I have collected the best-rated crypto exchanges that were approved as the safest platforms for buying BTC below, so take a look.

Pros

Cons

Table of Contents

What is Zcash: The Roots of Zcash

ZCash was created in October 2016 by a developer called Zooko Wilcox. Wilcox really liked what Bitcoin could do, but he didn’t like the fact that transactions were available for everyone to see. Instead, he wanted to create a blockchain that would allow people to send and receive funds anonymously – which is exactly what ZCash can do!

To make his dream a reality, Wilcox performed a fork of the original Bitcoin code. Wilcox made some really impressive changes to the Bitcoin code to make sure that not only was it more private than Bitcoin, but also faster!

Note: When a blockchain is forked, it means that the original code is copied, but then changes are made to make it better. Famous blockchain forks include Bitcoin Cash (forked from Bitcoin) and Ethereum Classic (forked from Ethereum).

One of ZCash’s biggest fans is the famous whistleblower, Edward Snowden, who recently said it is the most interesting alternative to Bitcoin! The project also received private investment from the cryptocurrency legend Roger Ver and ex-banker Barry Silbert.

The ZCash blockchain has its own cryptocurrency, which is also called ZCash, or “ZEC”. In total, there will be a maximum of 21 million ZEC coins, which is the same amount as Bitcoin. It is predicted to reach this amount in the year 2032.

UPDATE 2023 : The circulating amount of Zcash is currently 9,960,781.

However, the ZCash blockchain can process transactions much quicker than Bitcoin and it is also more scalable. Scalability is important as it means that a blockchain can process lots of transactions at once. I’ll talk about this in more detail later on…

The main feature that ZCash has is that it hides the identity of both the sender and receiver. In fact, it is so private that the only information you can see is the transaction date and time!

Just like Bitcoin, no single person or authority controls ZCash — it is decentralized! Instead, the blockchain is maintained by miners, who earn ZCash coins in return for their time and electric power.

So, now that you have a brief understanding of what it is and why it was created, the next part of my “What is ZCash?” guide is going to explain some of its features in more detail.

ZCash Review: How can ZCash Be Used?

The main purpose of ZCash is to allow people to send and receive funds quickly, cheaply and most importantly — privately. In fact, the ZCash team hopes that one day it will become a global payment system used by people all around the world.

Think about how you might send funds to somebody living in a different country. You would have to use to a third party such as a bank or Western Union. Whichever option you choose, the fees are normally quite high.

For example, sending $200 to Southern Africa costs an average of 14.6%, or $29.20! That’s a big fee to someone who might be living in poverty. An international transfer like this is called a “Remittance”, and it is a multi-billion-dollar industry that makes third-party intermediaries lots of money.

Not only this but sending funds to somebody in a different country can also take days before it arrives! For these reasons, ZCash is a great alternative.

Zcash system is able to confirm a new block every 2.5 minutes. A block is similar to a container carrying lots of different packages. However, instead of carrying packages, a block carries transactions! This is much quicker than Bitcoin, which normally takes 10 minutes to confirm a block.

When it comes to fees, the ZCash platform is much cheaper than sending funds with a bank. Although the fees change depending on how busy the blockchain is, it shouldn’t cost any more than a few cents!

Another advantage of ZCash over Bitcoin is the way miners operate. Although they both use a consensus model called “Proof-of-Work” (POW), the ZCash platform is much fairer.

Think about mining as a really difficult puzzle. To validate transactions on the blockchain, miners use their computing power that helps to solve the puzzle (or equation). Once it has been solved, the transaction is then confirmed in the block. To thank miners for solving the puzzle, they are rewarded with the coin native to the blockchain, which in this case is ZCash.

Mining Bitcoin has become really difficult as people are using expensive hardware called ASICs.

It’s like a being in a race with a Ferrari while you’re driving a Vauxhall! Who do you think would win? The Ferrari of course! This is how unfair it can be when mining Bitcoin — people with more money can buy more powerful equipment, meaning that they will always get the reward.

However, this is how ZCash is different. ASIC hardware does not work with ZCash, which means that people can use either a CPU or GPU to mine ZCash. These are much cheaper than ASICs, so anyone can mine ZCash!

There is a slight issue, though. For the first four years, ZCash developers will get 20% of all the transaction fees generated. They say that this will help fund the project, however, some people think this is unfair. If you used your electricity to mine ZCash, how would you feel about giving 20% of your reward to the developers? Probably not too happy, eh?

So, now that you know what it can be used for, the next part of my “What is ZCash” guide is going to explain how transactions work…