All you should know about Zcash (Zec)

The Zcash digital currency, represented by the ZEC, is in short, a fast, confidential, low-fee, cryptocurrency suitable for mobile payments. This is a short definition that can be found on the official Zcash digital currency website. In other words, the ZEC token uses advanced cryptographic techniques to create a financial mechanism by which users can conduct their transactions transparently or opaquely (encrypted) in the blockchain network.

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Prior to the introduction of cryptocurrencies such as Zcash, most cryptocurrencies were fully transparent, storing complete information about the number of transfers among users, sending and receiving addresses on the Blockchain network, and everyone was able to view this data.

In fact, one of Bitcoin’s strengths was its transparency, which made it trustworthy to users. Gradually, however, the tendency towards data protection of transactions became apparent, and some people thought of having cryptography in which the dissemination of information is under the control of the user.

What is Zcash (Zec)?

Zcash is a decentralized “Peer to Peer” payment network and a kind of cryptocurrency with Zec unit. This digital currency is a kind of “Hard Fork” for Bitcoin and owns about 21 million tokens. In fact, in general, it can be said that bitcoin codes have been used in the construction of Zcash protocol. Zcash, like Bitcoin, has its own unique blockchain and utilizes a mining process.  

Yet, the feature that differentiates Zcash from Bitcoin is the possibility of conducting transactions privately. As you know, in Bitcoin you can track transactions and examine assets at an address; however, Zcash is a private digital currency that uses advanced encryption techniques to keep transactions secret. This means that Zcash transactions are published in the public blockchain but the recipient, sender, and transaction amount are always kept secret. Of course, Zcash has the ability to display users’ transactions in public if they wish. According to the Zcash development team, it is possible to hide everything in its network, which is an important feature for many people.

Zcash was released on October 28, 2016, by its development team, and from the beginning, each block was equal to two megabytes. This cryptocurrency uses the “Proof of Work” protocol and the time required to generate each new block is calculated to be about one and a half minutes. At present, the mining bonus for each block for miners is 6.25 Zec and the network fee for transactions is 0.0001 Zec. It should also be noted that there was no “coin initial public offering” (ICO) for Zcash, and powerful investors in the world of digital currencies were the main sponsors of the project.

How does Zcash work?

If we do not take into account the privacy feature of Zcash, this cryptocurrency works just like any other one. Private and non-private transactions are verified by nodes and recorded in the blockchain. In Zcash, each block is added to the blockchain by a network of computers using the Equihash algorithm. This algorithm calculates the amount of RAM provided by the miner to secure the blockchain.

Also, the memory required to extract the Zcash is more than what cryptocurrencies need, in which case the Equihash algorithm enables fast verification of transactions on the network. Such a protocol is designed to reduce the impact of specialized mining or mining equipment, as well as the possibility of using weaker computers to receive network rewards. This means you will not need powerful devices to mine Zec tokens.

Another unique feature of Zcash was the way its digital currencies were distributed. The currency was originally planned that in the first four years of Blockchain activity, 80 percent of the block mining bonus would go to the miners and another 20% to the Electric Coin Foundation, as well as some of its key employees and investors.

What are the main features of Zcash (Zec)?

Low Transaction (Gas) Fee: Zcash supports high-speed transactions with a low fee of 0.0001 Zec. This digital currency is available in many wallets and digital exchanges.

Transaction and address privacy: The first purpose of the cache is to create cryptography with the ability to display or not display publicly the addresses and transactions in addition to the details of the transactions.

Encrypted note: The Memo Field is embedded in protected transactions for users. This feature allows the sender of the amount to send transaction-related information in encrypted form to the recipient. This feature can be used to transmit various messages and instructions; it can also be used to ensure the support of financial laws, especially the principle of the Travel Rule in the Bank Secrecy Act.

Display keys: Owners of protected addresses have keys called the View Key, through which they can show transaction details to legal authorities for compliance and auditing. The address owner is able to display all incoming transactions and their notes section. Nevertheless, does not have access to the sender’s address unless the identification information is stored in the note section. Zcash intends to enable the general display key feature as soon as possible so that users can display all the details of incoming and outgoing transactions.

Transaction expiration: Zcash supports transaction expiration capability to minimize the impact of unextracted transactions. By default, if the transaction is not executed after 50 minutes (40 blocks), the transaction will expire and the money will be transferred back to the sender.

Multi-signature transactions: Zcash also supports transactions that require multiple signatures to perform. Thus, if a transaction requires two or more signatures, it will be sent after approval by all parties to the contract. Of course, it should be noted that these types of transactions are transparent in themselves and cannot be executed privately.

In Conclusion

Many believe that blockchain technology is able to solve today’s problems, but the truth is that it will meet the needs of tomorrow. Privacy transactions may not be of interest to many people nowadays, yet you should know that it will become a vital feature in the near future. Not only is Zcash (Zec) a privacy-driven cryptocurrency, but it is also a platform that respects the freedom of action of all users by allowing them to choose between privacy and the public.