Zcash community proposes to abandon public transactions

What’s new? The community of the Zcash (ZEC) cryptocurrency has launched a vote to abandon the transparent pool, which is used to conduct non-confidential transactions whose information is publicly available. According to the proposal, getting rid of the transparent pool is proposed to go into effect on the tenth anniversary of ZEC — October 28, 2026. If the initiative is approved by the community, only anonymous transactions will be available on the Zcash network.

Voting on the Zcash form

What else is known? The reason for discussing the possibility of ZEC’s transition to a fully anonymous model was the actions of large centralized exchanges (CEXs). For example, in June and September last year, Binance delisted all anonymous cryptocurrencies for users from France, Italy, Spain, Poland, and Belgium due to local legal requirements. In December, the OKX crypto exchange announced the delisting of ZEC along with other anonymous coins (Dash and Monero).

Already at the beginning of the new year, global platform Binance also added a Monitoring Tag to Zcash and Monero. This tag suggests that assets can be removed from the platform due to not meeting its criteria.

In addition, the Binance manager responsible for the listing asked the Zcash team to prohibit sending coins from closed addresses to the exchange’s transparent addresses. Thus, the platform has no way to determine the source of funds, which creates risks of violating the sanctions of the US Treasury or AML laws.

At the same time, there is currently no mechanism in the Zcash protocol to prohibit a user from transferring funds from a secure pool to a transparent address, nor is there a method to determine the sender’s source address when sending from a secure pool.

The author of the initiative under the nickname tokidoki believes that if approved, Zcash users and investors will have enough time to adapt to the new model of operation. The same applies to exchanges, which do not intend to refuse to list a fully anonymous coin.

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Thus, in an earlier discussion, the new head of Zcash Electric Coin, Josh Swihart, wrote:

“A Binance delisting would be a significant loss. It’d hurt. BUT I don’t think we should make any protocol changes to kowtow to the whims of an exchange that is now effectively owned by US financial powers.”