Users, investors and even Edward Snowden himself all seem excited about a new cryptocurrency that was born today, but has been causing a stir on the network for months. Is named Zcash, and promises to be an alternative to Bitcoin that takes care of privacy of users while being offered as a real deal for investors.
Zcash was born from Zerocoin project, which after starting out as a layer of cryptographic anonymity for Bitcoin ended up becoming an independent cryptocurrency. As the expectations are many and you may hear a lot about it from now on, we are going to tell you what exactly Zcash is and what its fundamental differences are with Bitcoin.
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What makes the Zcash so attractive?
Much has been said about the privacy and pseudo-anonymity behind Bitcoin technology. Unlike the mythical cryptocurrency, the Zcash automatically hides the identities of senders and receivers, as well as the amount of all transactions that we do on your blockchain. Only those who have a display key will be able to see the content of the operations.
This is possible thanks to an algorithm called zero-knowledge proofs (zero evidence knowledge). This algorithm allows the creator of the transaction to include a validity test without the need to transmit any information other than the fact that the transaction is true. Therefore, no information that anyone can read is transmitted.
These characteristics have made voices as prominent in the world of privacy as Edward Snowden speak well of the project, referring to him as a solution to surveillance risks of the records of public transactions in Bitcoin.
Another of its fundamental differences between most cryptocurrencies and this is the way it is organized. Like Bitcoin and all those based on it, its code is open, although it is not managed as a community like most, but rather Zcash is a company. That makes the product attractive to investors.
The way of developing the project has also been the reverse, since instead of launching the coin and then looking for financing, the creators of Zcash have sought investors to create the coin before launching it. They also promise to reward these investors and workers with a tax they call “Founders reward”, described like this on its website:
“The monetary base of Zcash will be the same as that of Bitcoin – 21 million units of Zcash currency (ZEC or ⓩ) will be mined. 10% of the profits will be distributed among shareholders – founders, investors, employees and directors.”
This has caused the coin to grow exponentially before being launched. On September 15 its value was 18 dollars or 0.027 BTC, but two days ago I had already uploaded up to 260 dollars or 0.379 BTC, marking a growth of about 1,300%. What’s more, some market analysts believe that the price of a ZEC will surpass that of a bitcoin by the end of the year, as investors do not want to miss this opportunity.
Therefore, we have a cryptocurrency that does not try to go against the system, but relies on its classic financing methods to offer a free, anonymous alternative that promises to put the privacy of its users above all else. And what is more important, that investors don’t want to miss out on the next bitcoin, which is driving its initial growth very strongly.
The adventure is not without risks
But like all new technologies, there is nothing that can guarantee guaranteed success, and there is always a risk factor to consider. Bitcoins experts have described Zcash as an interesting and novel proposal, but its high privacy is not without its technological challenges.
The developer and operator of Bitcoins BTCDrak you have referred to the currency as the latest in crypto, although it says there is a lot of evidence that they are going to need a lot of CPU to sign the transactions. In fact, almost all naysayers are concerned about the demands and scalability of the blockchain.
In addition, those who have wanted to regulate the cryptocurrency market for a long time may not be very happy either, as well as those who see in it a vehicle to commit more crimes on the network. The creators defend themselves against the latter securing that this is like blaming the entire Internet for the crimes of a few, and that most of the operations that are going to be carried out with their currency are going to be legitimate.
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What is Zcash and why many see this cryptocurrency as the perfect substitute for Bitcoin