The Ultimate Guide to
What is Zcash?
According to CoinMarketCap, Zcash is the cryptocurrency with the 26th highest overall market capitalisation, with the total value of all Zcash currency units totaling Market Cap $1,371,597,257 as of 25th January 2018.
Zcash is one of the newer cryptocurrency, launched on October 28th, 2016. One of the qualities of cryptocurrencies most valued by advocates is that they provide users with greater anonymity than fiat currencies.
Bitcoin vs Zcash
Bitcoin, the most widely adopted cryptocurrency, has been criticised in this regard by those who most value anonymity as an examination of the blockchain can provide a degree of information on transactions, such as what was purchased. Each bitcoin user is allocated their own private key, which must be used to create a transaction order to send bitcoin.
This key’s presence within different transactions means that over time interested parties can glean information about an individual or entities purchasing and transaction trends.
Zcash emerged from a project called Zerocoin, whose CEO, Zooko Wilcox, is also the founder and CEO of Zcash. Zerocoin allowed bitcoin holders to convert their cryptocurrency holdings into ‘zerocoins’, which concealed the origin of a payment. Zercoins could also be split or merged into smaller and larger units and also converted back into bitcoin.
The version of blockchain used by Zcash only shows that a transaction took place. There is no information on which parties the transaction was made between nor its value. This means that vendors will not reject payment from a particular Zcash owner or involving particular Zcash units, based on their history.
Concerns have been raised as to how secure Zcash is, however, this argument is based on all Zcash transactions involving zero-knowledge transfers meaning users have no means by which to distinguish counterfeit Zcash units, were they to exist, from those created through the legitimate mining process.
Advantages of Trading Zcash with a Regulated Online Broker
Choosing to trade Zcash and other cryptocurrencies with a regulated online broker can help protect traders and add a layer of protection. For example, unregulated brokers do not have a financial regulator controlling the way the business operates and protecting client funds held on account. This exposes traders to the risk of the broker operating bad business practices, such as manipulating price quotes or failing to execute trades with minimal slippage.
The small print in the terms and conditions attached to bonuses offered by unregulated brokers can also mean that making subsequent account withdrawals can be difficult. If the broker were to run into financial difficulties or collapse, clients also have little protection of the funds held on account.
Regulated brokers, on the other hand, use segregated accounts, separated from the company’s operations, to hold client funds and deposits are protected up to a certain value, which varies depending upon the regulatory jurisdiction. Regulated brokers are also obliged to maintain best practice in their business operations, and price quotes and slippage rates are subject to supervision from the regulator. See a list of trusted brokers regulated by the Financial Conduct Authority in the UK here.
The Fundamental Influences of Zcash
As a wider asset class, cryptocurrency values are influenced by different drivers to fiat currencies. While fiat currencies are influenced by the monetary policy of central banks, national economies and geopolitical events, cryptocurrencies are largely detached from localised developments and policy. Having said that, events that decrease the value of fiat currencies can cause traders to opt for cryptocurrencies instead, increasing demand for them.
Current adoption rates, liquidity, supporting infrastructures such as wallets and exchanges and sentiment on the future prospects of these factors are the main drivers of cryptocurrency values. With very few vendors currently accepting Zcash payments, the privacy-focused cryptocurrency’s future may be closely tied to a partnership established with bank JPMorgan Chase. JPMorgan Chase are using Zcash’s privacy technology in its enterprise blockchain platform, Quorum, built on the Ethereum platform. Its future viability as a mainstream cryptocurrency could rely on either additional partnerships of this kind being built or significant inroads being made in terms of more mainstream vendors accepting it as payment.
Zcash Quick Facts
Launch date: October 28th, 2016
Launch value: $3,191.93
Lowest and highest levels to date: Zcash’s highest exchange value to date came when trading opened on October 29th $4,293.37, the day after the cryptocurrency’s launch. It’s value quickly dropped and hit a low of just over $26.43 on February 25th 2017. Subsequent, a modest recovery sees Zcash’s exchange value as of January 25th 2018 sitting around $440.15.
Daily exchange volume (as of January 25th 2018): $1,383,310,227
First brokers to offer Zcash trading: Zcash can currently be traded through CFDs with Plus500.
