Zcash: A Light at the End of the Tunnel?

“Cryptography used to be an obscure science, of little relevance to everyday life. Historically, it always had a special role in military and diplomatic communications. But in the Information Age, cryptography is about political power, and in particular, about the power relationship between a government and its people. It is about the right to privacy, freedom of speech, freedom of political association, freedom of the press, freedom from unreasonable search and seizure, freedom to be left alone.” - The Code Book, Simon Singh

Cryptocurrencies are built upon the philosophy that power is better distributed in the hands of the many rather than concentrated in the hands of the few.

With the invention of Bitcoin, Satoshi Nakamoto put this philosophy into action. Bitcoin was created with the explicit goal of providing a check on central bankers around the world that are prone to mismanaging money supplies and abusing their immense power as the gods of the global monetary system. In a post published on the p2p foundation just one month after Bitcoin launched, Satoshi stated, “the root problem with conventional currency is all the trust that's required to make it work. The central bank must be trusted not to debase the currency, but the history of fiat currencies is full of breaches of that trust.”

Yet, while the issue of concentrated power over the global monetary system is significant, it is far from the only significant political issue hanging over the global economy today. One other major issue is individuals’ waning right to privacy, signified by the prevailing regime of surveillance capitalism and looming threat of state-level surveillance. Bitcoin likely will not provide a full solution for this issue now or anytime soon. Meanwhile multinational technology giants continue to track our every move on the internet and central banks around the world are in the process oflaunching fully surveilled and controlled central bank digital currencies.

Enter Zcash

The problem with Bitcoin, and nearly every other cryptocurrency, is that they’re completely transparent. Contrary to popular perceptions of Bitcoin as an anonymous currency, every single transaction ever made using the Bitcoin blockchain is public and traceable. In some ways there has never been a monetary system with as much transparency as Bitcoin. Even just making a simple payment to a counterparty may reveal your entire financial history on Bitcoin - a status quo that is unacceptable for many individuals and businesses for the practical reasons of not wanting to share sensitive information with the world.

Storing your assets in transparent addresses and attempting to “anonymize” them through technologies like mixers only to return to transparent addresses doesn’t solve this issue. According to Electric Coin Company (ECC) CEO, Zooko Wilcox, “Nothing gives real privacy when used as a pass-through, because the attacker can just infer the linkage by comparing the inputs to the outputs.”