Zerocoin (XZC): A Privacy-Focused Cryptocurrency
| TYPE: | Currency |
| CREATION DATE: | October, 2016 |
| DEVELOPMENT STAGE: | Full Release |
| CURRENT SUPPLY: | 5,757,841 |
| TOTAL SUPPLY: | 21,400,000 |
| ALGORITHM: | LYRA2Z |
| PROOF TYPE: | PoW/PoS |
| BLOCK TARGET: | 10 minutes |
Bitcoin was developed with the goal in mind of having a public ledger display all executed transactions to ensure that people remained accountable for the coins they spent. However, a problem arose with this system in that one could easily trace the owner of these transactions using external information from the public ledger, such as publicly announced addresses. Once this problem came to light, Zerocoin (XZC) was developed to fix it.
Today, Zerocoin (Zcoin) claims to offer anonymity in all transactions, which is why Zerocoin (XZC) payment processing can have a unique value to individuals who wish to retain their online privacy. The Zerocoin team claims that they strive to increase individual liberty and freedom of commerce, without compromising usability.
Zerocoin uses zero knowledge proofs to mint their coins. The user “burns” their coin and generates a mathematical proof to prove that they burned it. This proof allows the user to redeem a new coin with no previous transaction history in exchange for the one they just created. By doing so, the new coin is not traceable back to the original sender, thereby ensuring their anonymity remains secure.
The developers of Zerocoin used the Merkle Tree Protocol (MTP) to develop a security system which prevented the disparity between ordinary users on the network and adversaries/cheaters who had larger capital resources to purchase more computing power to try and take over the mining of the coin. This leveled the field between individual miners and mining groups. The Merkle Tree Protocol establishes the same price/cost for a single computation unit on all platforms, thereby ensuring no single device gains an advantage over another. Attackers would need to spend the same amount as ordinary users for equivalent hashing power, and use similar hardware, preventing large scale attacks.
Zerocoin focuses on fast verification of the MTP to discourage DoS attacks on the network and increase the speed of transactions in general. Further, due to the low memory requirements of MTP verification, even smartphones can perform these tasks unlike many other verification methods on other coins which use memory hard processes.
Zerocoin follows the same halving cycle as Bitcoin (every 4 years), with a cap at 21,400,000 coins. In the first 4 years of its existence, 20% of the block rewards will go to the founder’s reward and the remainder to the miners. After 4 years, the whole block reward will go to the miners of Zerocoin.
Zerocoin claims to ensure your digital privacy without compromising its own usability in the process. By using the innovative MTP to mine its coins, every member of the network is treated as equal in their mining efforts, with the rewards being distributed accordingly.
For more information about our Zerocoin integration, or to start accepting Zerocoin (XZC) payments, make sure to use CoinPayments for your business!
Zerocoin Website | Zerocoin Block Explorer | Zerocoin on BitcoinTalk
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