ZEC is the coin used on the Zcash blockchain. “Zcash” refers to the protocol and network rules, while “ZEC” is the monetary unit that users hold and transfer. Zcash’s monetary policy targets a fixed supply of 21 million ZEC.

Zcash is a cryptocurrency network that supports both transparent transactions and shielded transactions. Shielded transactions use zero-knowledge proofs (zk-SNARKs) so the network can validate a transaction without publishing the sender, recipient and amount on-chain.

Zcash uses proof of work for consensus and is specified in the Zcash Protocol Specification. The proof-of-work algorithm is Equihash.

ZEC is used to transfer value on the Zcash network. Users can send ZEC using transparent transfers (t-addresses), where amounts are visible on-chain, or shielded transfers (z-addresses), where key transaction details are encrypted but still verifiable by the network.

ZEC is also used to pay transaction fees. Fees are paid by the sender and are collected by miners when transactions are included in blocks.

Because Zcash uses proof of work, newly issued ZEC is distributed through the block subsidy paid in each mined block. Since the 2024 halving, the protocol has also allocated a portion of block rewards to development funding streams defined by network upgrades and ZIPs.

Zcash keeps a transparent pool (public) and shielded pools (encrypted). Shielded pools hold encrypted notes, while the transparent pool uses publicly visible amounts. Zcash has had multiple shielded pools over time, including Sprout (legacy), Sapling and Orchard. Transactions can move value within a pool or between pools depending on the inputs and outputs used.

Network Upgrade 5 (NU5) enabled full support for the Orchard shielded protocol and moved Zcash to the Halo proving system. NU5 removed the need for the trusted setup used by earlier Zcash proving systems.

Zcash defines Unified Addresses (UAs), which bundle multiple receiver types (for example transparent, Sapling and Orchard) into a single address encoding. This lets wallets choose a compatible receiver when constructing a transaction, without changing what any given service chooses to accept. Unified Viewing Keys extend the same idea to viewing permissions across receiver types.

For selective disclosure, Zcash supports viewing keys, which separate spending authority from the ability to view shielded address activity. This is documented in ZIP 310.

Zcash also specifies payment disclosures (ZIP 311), which allow a sender to disclose information about shielded spends and outputs within a transaction as a proof of payment, without sharing spending keys.

New ZEC enters circulation through the block subsidy when miners produce blocks. Zcash targets a block interval of roughly 75 seconds. The block subsidy reduces over time according to consensus rules, with “halvings” as scheduled reductions in issuance.

Network Upgrade 6 (NU6) activated at block height 2,726,400 around 23 November 2024. From that activation, the protocol-defined block subsidy was allocated as follows:

• 80% to miners
• 8% to Zcash Community Grants (ZCG)
• 12% to an in-protocol lockbox (a pool tracked by consensus rules)

ZIP 1015 defines the lockbox as a deferred funding pool, but it does not define how the accumulated funds are disbursed. It states that the disbursement mechanism will be specified in a future ZIP.

Network Upgrade 6.1 (NU6.1) activated at block height 3,146,400 on 24 November 2025. NU6.1 instituted a funding model where:

• 8% of block rewards continue to be allocated to ZCG
• 12% of block rewards accrue to a coinholder-controlled fund, seeded by the deferred lockbox

Changes to the Zcash protocol are proposed and specified using Zcash Improvement Proposals (ZIPs). ZIPs can define consensus changes, wallet standards and process changes and are published in the public ZIP repository.

ZIP 0 describes the ZIP process. It states that anyone can write a ZIP and that the ZIP’s author is responsible for building community consensus and documenting dissenting views. ZIP Editors manage review and publication within the process.

Consensus changes are delivered through scheduled Network Upgrades that activate at defined block heights. Nodes must upgrade their software to follow the updated consensus rules after activation.