If you know a thing or two about anonymous transactions, you’ve likely come across these two networks. Here, we’re exploring the differences and similarities between these two well known privacy-focused altcoins.
Where Did They Come From?
Zcash originated from the workings of a professor and students at the John Hopkins university in 2013. The “original three” team wanted to create a privacy-focused extension to Bitcoin, initially called Zerocoin. In 2015, with the addition of other scientists, they formed the Zerocoin Electric Coin Company (now Electric Coin Company) and two years later (in 2017) the Zcash Foundation was launched. ZEC was first mined in 2016.
The seven founding members are Matthew Green, Ian Miers and Christina Garman (of John Hopkins), Alessandro Chiesa, Eli Ben-Sasson, Eran Tromer, and Madars Virza.
Monero’s origins can be traced back to Bytecoin, a privacy-focused cryptocurrency launched in 2012. Two years later the Bytecoin network was hardforked and Monero was created. Monero was created to provide “the greatest level of decentralization possible” prioritising privacy and security at the forefront, with ease of use and efficiency following closely behind.
It is believed that seven founders were involved in the launch, however, many chose to remain anonymous. To this day hundreds of developers have contributed to the cryptocurrency.
Where Are They Now?
Zcash currently sits just outside of the top 60 biggest cryptocurrencies by market cap and is trading around $110 (at the time of writing). Based off of Bitcoin’s codebase, the network opted to stay with a maximum supply of 21 million coins, of which 58% (12,189,000) are in circulation. In the last 24 hours roughly $517.5 million worth of ZEC has been traded, indicating a healthy network.
Monero at the time of writing has 17,950,000 XMR in circulation. While no coins were premined, the maximum supply of XMR is 18.4 million, expected to be reached in May 2022. Trading just over the $200 mark with a market cap of $3.8 billion, Monero is currently positioned within the top 30 cryptocurrencies according to market cap.
How Do They Differ?
When comparing Zcash vs Monero one of the most important aspects to look at is how they maintain their privacy when it comes to executing transactions. While the Monero network exclusively deals with private transactions, the Zcash network allows users to choose between transparent and shielded transactions.
Zcash uses zk-SNARK zero-knowledge proof technology that ensures when transactions are executed by nodes on the network that they can be verified without revealing any sensitive information. This cryptographic proof was designed in the 1980’s and allows parties to prove that it processes definite information without revealing the information in question. “In the case of Zcash, zk-SNARKs can be verified nearly instantly, and the protocol does not require any interaction between the prover and the verifier.”
Monero’s protocol on the other hand was developed by professional cryptographers and involves highly sophisticated cryptographic schemes involving ring signatures and stealth addresses. Ring signatures allow the sender to hide their identity by combining the sender’s account keys with other public keys on the blockchain. Once verified, the verifier does not either need to reveal their identity, with the ring signature acting as an anonymous digital signature.
Stealth addresses hide the identity of the recipient, and are randomly generated addresses created for each transaction, for one-time use only. Ring Confidential Transactions, or RingCT, is then used to hide the amount of the transaction when registered on the blockchain. The platform also makes use of a unique Proof-of-Work consensus algorithm called RandomX.
Primary Use Cases
While both cryptocurrencies offer users access to anonymous transactions, Zcash also provides “regular” crypto transactions. For whatever reason someone might like to send an anonymous transaction, both networks facilitate this service effectively.
Monero, however, is more widely used, and has a higher 24 hour transaction volume. The network has also grown a name for itself for being used in illicit online transactions, mostly attached to dark web marketplaces.
Zcash vs Monero
While both networks deliver on their privacy-promises, it's up to the user to decide which network they wish to transact on. While privacy coins might face some regulatory challenges going forward, for the meantime both networks are “legal” and safe to use. Through the Oobit platform users can buy, sell, store and convert ZEC.