Demand for Zcash Mining Grows as Blockchain Launch Approaches

With less than a month to go before its launch, momentum is continuing to build around the anonymous cryptocurrency Zcash.

AccessTimeIconOct 5, 2016 at 8:18 p.m. UTC
Updated Sep 11, 2021 at 12:32 p.m. UTC

With less than a month to go before its launch, momentum is continuing to build around Zcash.

The much anticipated anonymous cryptocurrency project gained a big ally today in hosted mining company, Genesis Mining, which announced that users would soon be able to mine for the digital currency. With the news, customers can now buy miners operated by Genesis, which offers similar services for bitcoin and ethereum.

But while the genesis block for the Zcash blockchain won't launch until 28th October, the product offering can be seen as evidence that interest in the technology, first announced in 2014, is continuing to grow.

Marco Streng, CEO of Genesis Mining, explained that his interest lies in how the Zcash could complement other blockchain projects. For a cryptocurrency to be viable, he argued, it needs to be fungible (ie one bitcoin has to be indistinguishable from any other) and if there is no privacy, there is no fungibility.

Zcash attempts to solve this problem, as despite what some believe, public blockchains like bitcoin are surprisingly not that anonymous. By simply auditing the blockchain, users can gain insight into whether their coins were ever used for illegal activities, such as on Silk Road.

By using what's known as a zero-knowledge proof construction, a cryptographic proof that allows the sender to prove to the receiver that value has been transferred without sharing any data or interacting, the ledger is able to secure all balances without identities and amounts being shared. Only those that have the correct key can see the actual value of the transaction.

Those interested in mining Zcash should note that the reward follows a similar path to bitcoin's, though with a twist planned around the time of its launch. During the first 34 days, the block reward will gradually increase from 0 ZEC to 12.5 ZEC.

Further, unlike many other altcoins that followed bitcoin's use of the SHA256 algorithm for proof-of-work, Zcash (ZEC) relies on an algorithm called Equihash.

Disclaimer: CoinDesk is a subsidiary of Digital Currency Group, which has an ownership stake in Zcash.

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