Trade Zcash to BTC on Beaxy
Zcash, previously known as Zerocoin, was created in 2013 in an effort to combine advanced mathematical techniques like zero-knowledge proofs, that introduce anonymity to the protocol, with the proven consensus mechanisms of the Bitcoin blockchain.
Features of Zcash
Address and Transaction Privacy
Zcash give you the option to choose between a shielded or transparent address. The shielded addresses can not be seen by other participants on the Zcash network. Transparent addresses are publicly listed and can be tracked on the Zcash blockchain.
ZEC transaction network fees as .0001 which is much less a penny for each transaction. This is an affordable option compared to other digital assets.
You can attach a memo to transactions made within a shielded address wallet. This allows participants of ZEC to send encrypted messages and instructions to each other.
This feature was added to satisfy potential compliance and auditing efforts. The payment disclosure allows the sender or recipient of shielded transactions to disclose parts of a transaction to a third party as needed.
Frequently Asked Questions
What is Zcash?
The Zcash founders were concerned that Bitcoin could not offer adequate privacy to users of the cryptocurrency. However, after initial testing with zero-knowledge proofs, Bitcoin core developers decided that the feature was too cumbersome to be integrated with Bitcoin’s programmatic functions. Zcash developers would eventually improve their protocol resulting in significantly more efficient zero-knowledge proofs. Once the protocol had been fully launched, the project brought on CEO, Zooko Wilcox, who raised more than $3 million from venture capital firms. The team, now with a fully functional protocol, began the development of a comprehensive and privacy-focused cryptocurrency. In 2017, the Zcash Foundation was created as a nonprofit to fund future development of the protocol and digital currency. Two years later, the Zcash company was renamed as the Electric Coin Company. ZEC is used as the native currency of Zcash, a decentralized and open-source digital asset platform that gives you the ability to determine which information about your transaction you’d like to be publicly broadcasted. The user can initiate a shielded or transparent transaction. Shielded transactions utilize zero-knowledge proofs called zk-SNARKs that make for a completely anonymous network.
Zcash represents a big technology breakthrough for a digital assets project as it gave ZEC owners the ability to choose whether or not they wanted their transaction to be partially or fully anonymous. This was done through the creation of shielded and transparent wallets. Additional technology provided by Zcash includes transaction expiration and multi-signature transactions. Transaction expiration limits the impact on transactions that are not validated and mined. A Zcash transaction will be canceled if it remains unmined for 50 minutes or roughly 20 blocks.
How to mine Zcash?
On the Zcash network, new blocks are mined and created every two and a half minutes. Zcash is beneficial to newcomers to mining because of its Equihash algorithm which makes Application-Specific Integrated Chips (ASIC) hardware incompatible with the network. This lowers the barrier to enter Zcash mining because less power is needed to compete with other miners on the network. You can even mine Zcash with only the Central Processing Unit (CPU) that is already built into your computer. Although, Zcash still does permit the use of a Graphical Processing Unit (GPU) which is faster and much more energy-efficient than a CPU component. Once your mining hardware is in place, you will need to take ownership of a ZEC compatible wallet. According to the Zcash team, using a hardware wallet that is not connected to the internet is the best method you can use to securely store the ZEC that you receive through mining. After you set up a ZEC wallet, you can join one a ZEC mining group and begin to exchange your computing power for a share of ZEC that is mined by your group.
Risks of Zcash Trading
Investment Risk Zcash (ZEC) is a volatile digital asset that has large price swings relatively short periods of time. Since it was launched, Zcash has traded for a low as $18.94 per coin and as high as $4,400 per coin when it first began trading. As the volatility of an asset’s price increases, the inherent risk increases as well. It is essential to assess Zcash’s price risk before buying or selling the digital asset. Security Risk The cryptocurrency that you hold in a self-custodied wallet has inherent security risks. This stems from hackers’ ability to infiltrate your wallet if they discover your private key. The best practices for reducing this security risk include using a cold storage wallet, refraining from entering your private key onto your computer, and never showing it to anyone else. Lastly, the best method is to find a wallet provide that offers a custody solution and insurance on your waller. This is the ultimate protection. Even if a hacker accesses your wallet and withdraws your coins, the insurance provider will compensate you for your losses. Regulatory Risk Zcash, like Monero, may have a higher regulatory risk relative to other digital currencies as it is a genuine privacy coin. Meaning that not even the wallet address of participants is recorded or published by the public ledger. Theoretically, this makes it easier for someone who is laundering money to conceal their identity. Authorities can be expected to provide more clarity about the regulation of privacy-focuses digital assets in the future. Until then, it is essential that anyone buying or selling Zcash considers the risk that unfavorable laws and regulations may be applied to privacy coins in the future.
Conversion rates US Dollar (USD) to Zec (ZEC) 05/17/2022 09:35 AM
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