Zcash Features

Below are the primary features of Zcash Cryptocurrency:

1. Addresses: Zcash has two types of addresses: private (z-addresses) and transparent (t-addresses). Z-addresses start with the letter “z,” and t-addresses start with “t.” The two are interoperable and funds can be transferred between them. Most wallets and exchanges exclusively support t-addresses, however support for shielded addresses is available for mobile and desktop wallets.

2. Transactions: Transactions between two t-addresses work just like Bitcoin, with the sender, receiver and transaction value publicly visible. Transactions involving shielded addresses include shielded (z-to-z), shielding (t-to-z), and deshielding (z-to-t), with the z-address getting privacy protections. The shielded (z-to-z) is the most secure transaction, which encrypts the sender and receiver addresses and transaction amount. However, all transactions appear on the public blockchain, so a transaction is known to have occurred and what fees were paid.

3. Viewing keys: The owner of a z-address can share its transaction details with trusted third parties via a view key. It refers to a key with read access but no spending authority. This allows compliance with payment for auditing, tax regulations, or anti-money laundering rules.

ZCash also offers some Supporting features:

• A fixed total supply of 21 million units, exactly like Bitcoin
• Default but configurable low-fee transactions of .0001 ZEC.
• Encryption of memos to securely pass along messages or other useful data.
• Transaction expiration to reduce mempool bloat; default expiry is 40 blocks (50 min).

Zcash Protocol

1. Units and divisibility: The unit of account of the Zcash system is a ZEC. The ticker symbol used to represent Zcash is also “ZEC”. A zatoshi is the smallest amount within Zcash, representing 0.00000001 ZEC, one hundred millionth of a ZEC.

2. Funding Structure: Zcash pays out a portion of each block reward to fund protocol development and (for the first year) to pay back investors. During the first four years of Zcash, 10% of the block reward was transferred to the Founders Reward fund and distributed to the Electric Coin Co., Zcash Foundation and initial investors. After network upgrade 4, 8% of the block reward will be transferred to the Dev Fund and managed by a Major Grants Review Committee.

3. Mining: Originally Zcash could be mined at home, using CPU or GPU machines. As mining hardware evolved, ASIC machines became the preferred mining machine for professional cryptocurrency miners and mining pools.

4. Scalability: Scalability is a work in progress. The current proposal calls for the use of sharding. It is a technique that partitions a database into sections or “shards” to improve the throughput limit, in order to scale to high transaction volumes.