Zcash is a kind of digital currency with an open initial code is developed by the company Zerocoin Electric Coin Company. This e-currency uses cryptography to increase the level of security and anonymity of investors.
Zcash is equipped with an innovative system that allows the participant to privatize their transactions by adopting zk-SNARKS. The Protocol allows hiding the external data of the transaction, except the time of their receipt/sending. If the client wishes, this data can be in open or closed access for ensuring confidentiality.
Also, this type is the first cryptocurrency created on the algorithm of evidence with zero disclosure. This allows you to hide the amount and recipients of protecting transactions with Zcash.
Like Bitcoin, it has a limited reserve of coins. The maximum amount of Zcash coins is 21 million units. The protocol of this digital currency does not store information about the sender and recipient.
The interchangeability factor in Zcash is the advantage of this coin. That mean, there are no differences between the coins, regardless of the ways of obtaining. Also, the advantage is the inability to compromise the client. This practice helps to protect information about the origin of coins and attract new investors.
An interesting fact about the Zcash cryptocurrency is that among the founders of the company, a unique program called «reward for founders» exists. According to this program, until 2020, no matter how many Zcash coins are earned, 20% of them will be distributed among the founders of the company. And about 10% of this reward will be donated to a trust called the Zcash foundation. They own the Fund, which was created to develop the infrastructure of the Internet, particularly payments and privacy.
What affects the price
According to many experts, Zcash is attached to Bitcoin and follows the trend of the first cryptocurrency. If the drawdown BTC is high, ZEC will lose price respectively. This pattern can be traced on the annual charts, where the trend is visible for both coins.
The second aspect that determines the price of Zcash is demand. The coin can’t boast of any really unique solutions. Therefore, it constantly competes with Monero and other anonymous altcoins.
The capitalization of Zcash is growing with the high price of Bitcoin, but on the bearish trend, the significant outflow of funds takes place. This ensures high market volatility and freedom for traders.
Unlike most other coins, ZEC reacts poorly to news and government intervention, so the currency is fairly stable and predictable.
Changes of quotations of the USD will also affect the rise or the fall of the Zcash. This relationship is indirect, but the difference of 100-200 points in USD can lead to a jump in ZEC 20-50 USD.
Although there is a common correlation with Bitcoin, Zcash is more impulsive. Even within one trend, it can fluctuate significantly, bringing from 15 to 100% of net profit. For example, in July 2019 there were 8 such swings.
Given this fact, trading Zcash is most profitable on a weekly timeframe. In this case, it is quite simple to predict the rate. But don’t forget that any cryptocurrency reacts sharply to forks and upgrades, and ZEC is no exception.
Events related to the introduction of new protocols, connection to payment systems, contracts with international corporations – all of these are reasons for a sharp increase in the rate.
In this case, the currency for the day can add up to 200% but very quickly lose potential and return to the average figure.