What is Zcash (ZEC)? Explanation of this privacy coin
Zcash (ZEC) is a privacy coin, a cryptocurrency that gives users the option to fully or partially shield their transactions. Unlike many other digital currencies, Zcash allows users to choose: transactions can be transparent or private. This combination of privacy and transparency is what sets Zcash apart from projects like Monero. Although Zcash (ZEC) is widely used by people who want to protect their financial data, it is important to understand how it works, why privacy plays a role, and how it differs from other privacy-focused cryptocurrencies. Coinmerce does not offer Zcash itself, but there are comparable projects available that enable privacy in a regulated way.What is Zcash (ZEC)?
Zcash is a cryptocurrency launched in 2016 by the Electric Coin Company, led by cryptographer Zooko Wilcox. The project was created to combine the benefits of blockchain technology—security and transparency—with financial privacy. Zcash is an open-source project running on its own blockchain. It uses advanced cryptography, specifically zero-knowledge proofs, to verify transactions without revealing sensitive information. ZEC is not available on Coinmerce, but alternatives such as Dusk (DUSK) and Beam (BEAMX) also focus on privacy and security, each with its own technology and use case.In summary
- Type of cryptocurrency: Privacy coin
- Purpose: User control over transaction privacy
- Network: Own blockchain with Proof-of-Work
- Key technology: Zero-knowledge proofs (zk-SNARKs)
- Launch year: 2016
- Developed by: Electric Coin Company and Zcash Foundation
Price and history of Zcash (ZEC)
Like other cryptocurrencies, the price of Zcash is driven by market supply and demand. Since its launch in 2016, ZEC has experienced significant volatility. At launch, the price was extremely high due to limited supply, but it later stabilized. Over the years, Zcash has become a well-known name among privacy coins, largely due to its unique balance between transparency and data protection. ZEC is often compared to Monero, which enforces full privacy by default, while Zcash takes a flexible approach that lets users decide.How does privacy work in Zcash?
Zcash uses zk-SNARKs (Zero-Knowledge Succinct Non-Interactive Argument of Knowledge), a cryptographic technique that proves a transaction is valid without revealing the underlying data.Transparent and shielded transactions
- t-addresses (transparent): Work similarly to Bitcoin; transactions are publicly visible.
- z-addresses (shielded): The sender, receiver, and transaction amount are fully hidden.
When do users choose privacy?
Shielded transactions are typically used when users do not want their financial data to be public, such as for donations, business payments, or personal transfers. Transparent transactions, on the other hand, can be useful when compliance or regulatory reporting is required.Zcash vs Monero
Key differences in approach
- Privacy model: Monero enforces privacy by default; Zcash offers optional privacy.
- Technology: Monero uses ring signatures and stealth addresses; Zcash uses zk-SNARKs.
- Transparency: Zcash is more suitable for regulated environments.
Differences in use and adoption
Monero is popular among users seeking maximum anonymity. Zcash focuses on compliance-friendly privacy, making it more appealing to companies and developers. Regulation plays a significant role in the adoption of both projects.Zcash wallets: what to look for
Wallet types and secure storage
- Zcashd and ZecWallet – official desktop wallets
- Light wallets – mobile wallets supporting shielded transactions
- Hardware wallets – such as Ledger (usually only transparent addresses)
