Zcash is a cryptocurrency based on Zerocoin protocol and aims to have more secure and enhanced privacy for its users.
Cryptocurrency started its journey with a view to making the movement of currency easier and more secure.
Bitcoin was leading the line, followed by other cryptos which were equipped with more advanced technologies. For example, Monero and Dash were created only for better security advantages or to give more security oriented currency to the users. But with the release of Zcash, the security or privacy of the users went in top because here users can remain anonymous which can provide even safer use of cryptocurrencies.
In Zcash, users can totally hide their identity by zero-knowledge proof construction called zk-SNARKs. Zooko Wilcox, the founder of the Zcash and Zerocoin, created a protocol in between 2013 and 2014 in which bitcoin can be converted into zerocoin. In this way, the total transaction process was kept secret. Then the developers with the help of cryptographers from different university created Zerocash which provide much better privacy than zerocoin which is known as Zcash. So high level of anonymity was established which give us greater fungibility i.e. exchangeability.
Bitcoin users have already faced problems regarding blacklisting coin. But Zcash does not have these problems.
But above all Zcash is extremely experimental which means it is relatively weak. Bitcoin core developer Peter Todd said Zcash as completely broken. He also mentioned the possibility of evil minds to use fake zk-SNARK proofs.
Besides, it also has centralized foundation and development team which is the major drawback of the cryptocurrency. As all the transactions involve zero knowledge transfers, it should not be controlled by a single foundation. Through the private keys were destroyed in a ceremony which is known as multi-party communication protocol, it still has a chance of creating counterfeit currency by someone if they somehow get the privet key. This will make it vulnerable to the attackers, as they will be able to produce an unlimited amount of Zcash.
While Zcash is far fewer than bitcoin, it uses similar market functions. Again, mining of Zcash is also much easier as it would allow customers to buy miner for the sake of mining Zcash.
Besides its unique mining model, the major difference is that 10% of the 21 m units mined using zerocash protocol which is called the founder’s reward will go to Zcash’s stakeholders.
Another important difference is that it has a slow start mechanism, which would manage the risk of the protocol having a major bug or security vulnerability. There is also a massive price fluctuation of Zcash. For example: at the first day of its release its price reached to 3300 BTC but again fell quickly to 48 BTC at the same day.
Though we talked about different drawbacks in our above discussion, it has a simple yet easy payment procedure. It is still largely being untested, and it needs to adopt the modern currency platforms. And its price volatility can bring a ton of profit for the traders who might invest.
If you want a secured and anonymous ID and want to make a profit, Zcash might be the best digital currency for you.