- The basics of both projects.
- Reasons why anonymity is important.
- A history of the Monero blockchain.
- A history of the Zcash blockchain.
- The purpose of both currencies.
- Their transaction speeds.
- The current adoption of Zcash and Monero.
- The cost of making transactions on both blockchains.
- Scalability issues facing the projects.
- A look at the teams themselves.
- The market history of Zcash and Monero.
Table of Contents
- 1 The Basics
- 2 Monero vs Zcash: Fundamental & Technical Specs
- 2.1 Purposes
- 2.2 Speed
- 2.3 Adoption
- 2.4 In-Browser Mining and Crypto-Jacking
- 2.5 Online Publishing
- 2.6 Crypto-Jacking
- 2.7 In-Browser Mining and Charity
- 2.8 Problems with Adoption
- 2.9 Cost of Fees
- 2.10 Scalability
- 2.11 The Teams
- 2.12 Market History to Date
- 3 Zcash vs Monero: Comparison Chart
- 4 Zcash vs Monero: The Conclusion
The BasicsTo start this Zcash vs Monero guide, I’ll first take you back to before either coin existed. When the Bitcoin blockchain was first launched, many articles appeared about Bitcoin’s anonymous nature. It was the preferred currency for use on the dark web marketplace, Silk Road. Silk Road was the first of many services that allowed users to buy illegal goods and services online. It was therefore crucial that the currency used was completely private and untraceable. Unfortunately for many, this is not the case with Bitcoin. Since the Bitcoin blockchain (database of transactions) is totally public, those who don’t use complicated additional privacy measures can easily be traced. With a little knowledge and careful study of the Bitcoin blockchain, it’s possible to uncover the identities of those making transactions.
Why Go Anonymous Anyway?Before I get to the focus of this article – Zcash vs Monero – it’s important to discuss why someone would want to keep their identity a secret when making transactions. There are many of these reasons. Some are morally questionable and others much less so. The reasons include:
- To buy substances deemed illegal in the part of the world you are living in. These can be used either medicinally or recreationally. Medical cannabis, for example, is perfectly legal in some parts of the world and it is not in others. It seems bizarre and completely unjust in a globalised world that the side of an imaginary line on a map you were born on should decide which medicines you’re allowed to use. Privacy coins allow people to access these substances without having to meet potentially dangerous people in person. They protect the identity of the buyer when making purchases.
- To pay for services that enable illegal acts. This could be malicious, as in software for use by hackers. It could also be non-malicious. Non-malicious uses of anonymous currencies include using gambling services in areas where games of chance are illegal, and even paying people for services relating to free movement. For example, if a homosexual wanted to flee from a nation ruled by an oppressive government such as Saudi Arabia.
- Fungibility – another problem with Bitcoin’s blockchain is that it’s possible to see where a Bitcoin has come from. This is an issue since some vendors could choose to reject payment if the funds have been used illegally in the past. Clearly, this is not a good quality for money. Both Monero and Zcash make it so that no one can tell if a unit of either currency has been used illegally. As the Zcash motto states: “all coins are created equal”.
Back to the Basics…Now that you know some of the many reasons why someone would want to use an anonymous currency, lets looks closer at Zcash vs Monero. I’ve already established that both coins provide privacy to their users but there are other similarities and differences between the two projects. I’ll first offer a brief description of the histories of each cryptocurrency before looking more at some of the specifics of them.
MoneroMonero was originally created in 2014. It was previously known as BitMonero. However, this was quickly shortened to simply to Monero. Monero is actually a fork of an earlier cryptocurrency called Bytecoin. However, there was controversy over the launch of Bytecoin since 80% of it had already been mined before its release. Some of the developers and community surrounding the project didn’t agree with this. They therefore forked Bytecoin in 2014. This fork would eventually become the currency that is now referred to as Monero. Monero uses a different protocol to Bitcoin. It’s called CryptoNote. CryptoNote works by grouping many transactions together. This makes it impossible to tell which one of the inputs (senders) each transaction belongs to. If you’ve ever heard of a Bitcoin mixing service, it’s kind of like one of those. Like Bitcoin, Monero relies on Proof of Work to validate transactions. Proof of Work requires that computational power be used to update the Monero blockchain. The computer systems providing this power earn rewards in the form of transaction fees, as well as newly minted coins for creating new blocks of transactions.
Monero vs Zcash: Fundamental & Technical SpecsTo begin the head-to-head comparison of Monero vs Zcash, let’s start with their purposes.
PurposesThe purpose of both Monero and Zcash is that they’re to be used only as currencies. This means that the developers behind both projects intended that each coin be used to make payments. In the case of Zcash, these transactions can be private if the sender requests it, or public if that is their wish. In the case of Monero, transactions are only private. The purpose of private transactions is to protect the identity of users for the reasons I mentioned earlier. There are also some who feel it is their right to use their money in a way that is free from being looked at by others.
Speedsome that claim that Monero can handle 1,700 transactions per second. However, this has never come close to being tested. For this to occur, the memory requirements would be far too great for many of the network’s nodes anyway.
AdoptionOne of the areas that these two privacy-focused projects differ is with their levels of adoption. Monero seems to have found more use on the dark web than Zcash. This is because Monero is much easier to use than Zcash at present. There are few reliable wallets for the currency at present. However, being a relatively young cryptocurrency, this will certainly change. Monero has found use cases on the dark web, by rogue states such as North Korea who want to get around international sanctions, and by groups of hackers. The ease with which it can be mined by regular computer systems has also led to some other interesting uses.
In-Browser Mining and Crypto-JackingAnother area in which Monero has found adoption is for in-browser mining. This is because it’s still possible to mine Monero using just a GPU or CPU. In-browser mining involves running mining software from an internet browser. It’s very easy to do although not very efficient. However, if you get hundreds or thousands of computer users to use their own electricity to do it for you, it can be very profitable.
Online PublishingFor some publishers of content, in-browsing mining represents a way to monetise a webpage without forcing advertising on their visitors. If it’s made clear that some of the computational power of a website visitor will be used to help fund the site, there is no real harm caused by this. The user is free to decide if they want to stay mining for the site or not.
Crypto-JackingSome publishers are not very forward about the fact that they are forcing users to mine cryptocurrency for them. Additionally, some download websites have hidden Monero mining software as part of the file users are downloading. Mining software being used on a computer without the owner’s permission is known as crypto-jacking. When we compare Zcash vs Monero, Monero is preferred for crypto-jacking because of its anonymous properties and the fact it’s still mineable using CPUs and GPUs.
In-Browser Mining and CharityFinally, in-browser mining has been used for altogether more charitable causes. Children’s charity UNICEF launched a website called The Hopepage. The idea behind The Hopepage is that computer uses can visit the website and donate some of their unused computational resources to mining Monero for UNICEF. When the website loads up, there is a clear option to start mining. The visitor is then asked how much of their computing power they would like to donate. If the tasks they are doing require a lot of power, they could just donate 20%. Or, if they’re just browsing some websites, they can donate up to 80%. At the time of writing, there were a massive 18,000 people donating on The Hopepage!
Problems with AdoptionThe Japanese Financial Security Agency (FSA) stated on June 18, 2018 that there will be a ban on anonymous coins. As well as Monero and Zcash, coins like DASH and Augur’s REP have also been targeted. The FSA have stated that the reasoning behind their move is to try to make it more difficult for cryptocurrency to be used for illegal acts. If more countries follow the example set by Japan, the adoption rates of such privacy-focused coins could suffer greatly. One of the areas that Zcash could win out over Monero in the war of the privacy coins is the fact that Zcash transactions don’t need to be private. This could help them avoid some potential regulatory issues in the future and may help them abide by “know your customer” requirements in various countries.
Cost of FeesBitinfocharts.com, they have remained very low throughout Zcash’s existence.
ScalabilityBlockchain scalability is one of the most pressing issues facing the entire cryptocurrency space. For a digital currency to truly be able to compete with the likes of VISA on a global scale, networks need to be able to handle much greater transaction volume than they can at present. Monero has attempted to tackle scalability issues with its dynamic blocksize limit. However, as evidenced by the massive fees it has suffered from in the past, this is not enough to allow the network to be used by the entire planet. Meanwhile, Zcash faces even worse scaling issues than Bitcoin. Since private transactions take up a lot more space in blocks than Bitcoin, if everyone wanted to make anonymous transactions, there would quickly be a race to the top of transaction fees. This was what happened to Bitcoin in the spring of 2017. However, there isn’t enough demand for Zcash for such a race to occur at present.
The TeamsWhen comparing cryptocurrencies, it’s always good to look at the teams behind the projects. That’s exactly what I’ll cover next in this Zcash vs Monero guide.
Monero TeamThe Monero team is largely a secret. Two of the lead developers on the project are known. The others operate under aliases.
Zcash TeamMeanwhile, the Zcash team is much more open. The CEO and founder of the project is Zooko Wilcox. He’s a developer with more than 20 years’ experience in cryptography and data security. He’s very active on Twitter under the handle @zooko. Zooko is joined by an experienced team of scientists. First is technician Eli Ben-Sasson. Eli is a respected lecturer at the Israel Institute of Technology. He’s also an expert at designing and applying proof systems. Next is Alessandro Chiesa. Chiesa is a member of the Computer Science department at Berkeley University. He studied up to PhD level at the Massachusetts Institute of Technology. These three are joined by a lengthy team of technicians and computer science experts. However, largely absent is a marketing team. This may limit the potential adoption of Zcash in the future. Interestingly, some of the biggest names in the cryptocurrency space act as advisors for the Zcash project. The likes of Gavin Andresen, Vitalik Buterin, Arthur Breitman, and Dana Syrcuse all aid the core team.
Market History to Date
MoneroMonero was first created in the famous crypto bear (pessimistic) market of 2014. During its early years, the price action against the dollar remained constant. There were no great moves in either direction.
ZcashThe Zcash price history follows a similar pattern to that of Monero (and many other cryptocurrencies for that matter). As you can see from the image below, after its launch it experienced sideways price action. The uptrend started a little later than Monero’s, however. During the middle of 2017, the price started to increase versus the US dollar. You can see in the price graph that it stayed consistent with the price of Bitcoin throughout the year. As Bitcoin rose, so too did Zcash. When Bitcoin fell, so too did Zcash. That’s why the orange line representing the Zcash performance against Bitcoin remains virtually flat throughout the life of the coin so far. You can see the full history of the Zcash price below.
Zcash vs Monero: Comparison Chart
|Founded||Total end supply||Total units at time of writing||Current price in USD||All-time high in USD||Mining algorithm||Blocktime||Mining||Transactions per second|
|Monero||April 2014||18,400,000 (+ 0.3 XMR/minute)||16,180,000||$119.98||$494||CryptoNote||2 minutes||GPU/CPU||Theoretically unlimited|
|Zcash||October 2016||21,000,000||4,240,000||$150.79||$876||Equihash||2.5 minutes||GPU/CPU||Between 6 and 26|
Zcash vs Monero: The Conclusion
- The basics of Zcash vs Monero.
- The purposes of Zcash and Monero.
- Their transaction speeds.
- Adoption of Zcash and Monero.
- Scalability issues facing each team.
- The market history of Zcash vs Monero.