Exchange Gemini enables “armored” withdrawals for Zcash

The exchange of bitcoin and other cryptocurrencies based in New York, Gemini, announced on Tuesday that it has enabled “shielded” withdrawals for the operators of Zcash (ZEC), one of the cryptoassets with the longest experience in the field of privacy.

Gemini explained that the storage of Zcash, in the accounts of the operators, is done through “t” addresses. Those wishing to withdraw privately should send the funds held to a “z” address. The exchange house already allowed ZEC deposits from “z” addresses.

In the Zcash project there are two types of addresses to carry out transactions. Those of type “t” or transparent that are executed like any Bitcoin operation, for example; and the “z” directions. In this case the information about the sender, the receiver and the amount of the transaction is not disclosed.

The Gemini exchange is a startup of the brothers Tyler and Cameron Winklevoss and is regulated in New York. Source: TechCrunch / flickr.com.

“It is the first time that ZEC’s armored retreats are available in a exchange regulated (…) which shows that, with the right controls and the right education, regulators can feel comfortable with cryptocurrencies that allow privacy, ”said Gemini in a note press.

From Electric Coin Company (ECC), the company behind Zcash, ensured that shielded transactions, sent or received through a exchange regulated, “prevent unauthorized third parties from viewing a user’s financial history.” However, in the same release it was noted that regulators can request “more information through legal and audit procedures.”

From the foregoing, it could be interpreted that Gemini leaves the door open for regulatory authorities, such as the New York State Department of Financial Services (NYDFS), to address any concerns or suspicions. may intervene to request more information about the operators and their movements in the exchange.

Gemini’s decision and her reactions

The new support for “armored” withdrawals in Gemini generated mixed opinions among users. In social networks there were those who commented on the measure since they consider there are no grounds that support the fact that a regulated entity guarantees the privacy of the operation.

One of them was the user NestNoether, who from the Monero forum in reddit He indicated: “The withdrawals are not completely ‘confidential’ on the chain. The quantities and directions of origin are clear. Whether this is risky or not depends on your use case and threat model.

The participant received a response from the user SamsungGalaxyPlayer who commented: “I don’t think pointing this out matters much, instead it may lead someone too far in the wrong direction. In the worst case, (this) reveals to another user that they probably bought the funds on Gemini if ​​the amounts match and if they can associate those addresses with Gemini. ‘

For the forum member, the announcement, from a regulatory and compliance perspective, “doesn’t matter” since the exchanges “They know what the amounts of the withdrawals are, regardless.”

The new support for ‘shielded’ withdrawals had a reaction in the cryptocurrency market. According to the information service CoinGecko, Zcash has appreciated 6% in the last 24 hours. At the time of publishing this article, its price was $ 60.04 per unit.

It should be remembered that privacy-oriented cryptocurrencies such as ZEC have experienced setbacks in recent years among exchanges. Exchange houses allege that they have withdrawn the crypto asset from their trading peers because they must comply with more transparent regulatory standards.

CriptoNoticias reported in August 2019 that Coinbase in the UK excluded the cryptocurrency from its platform. In this case, no official reason was given, but it was reported that the remaining ZEC balances, which were not withdrawn or exchanged, would be converted into sterling.

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Exchange Gemini enables “armored” withdrawals for Zcash

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