Unlike current fiat monetary systems, there are multiple proof-of-work protocols with deflationary properties. This means that less coins (%) are released into circulation each year, usually converging on a maximum supply quantity. Bitcoin was the first instance of a decentralized, deflationary proof-of-work protocol.
Bitcoin (BTC)
In November 2008, the unknown 'Satoshi Nakamoto' mysteriously released a paper titled 'Bitcoin: A Peer-to-Peer Electronic Cash System' via a cryptology mailing list. Also known as the Bitcoin White Paper, this nine and a half page document provided detailed analysis of a peer-to-peer electronic cash system created to combat the Internet's reliance on "financial institutions serving as trusted third parties to process electronic payments."
Bitcoin's reputation as anonymous is a common misconception, it is pseudonymous. Since all transactions that have ever taken place on the network are publicly available on the blockchain. It is possible to analyze this data and ascertain account inter-connectivity and financial relationships throughout Bitcoin's history.
Since Bitcoin's release, other deflationary store-of-value protocols have utilized Bitcoin Core code as a starting point for more sophisticated technologies. Most of these changes to the protocol aim to improve on Bitcoin's anonymity, scalability, and fungibility.
Bitcoin's reputation as anonymous is a common misconception, it is pseudonymous. Since all transactions that have ever taken place on the network are publicly available on the blockchain. It is possible to analyze this data and ascertain account inter-connectivity and financial relationships throughout Bitcoin's history.
Since Bitcoin's release, other deflationary store-of-value protocols have utilized Bitcoin Core code as a starting point for more sophisticated technologies. Most of these changes to the protocol aim to improve on Bitcoin's anonymity, scalability, and fungibility.
Zcash (ZEC)
Launched in Fall 2016 by the Zerocoin Electric Coin Company, Zcash focuses on preserving privacy of transaction data utilizing zero-knowledge succinct non-interactive arguments of knowledge (zk-snark) mathematical proofs to shield sender / receiver addresses and transaction quantities within a block.
Via rigorous analysis of the mathematical proofs support zk-snarks, C2C has identified Zcash as the premier ‘privacy’ coin and deflationary store-of-value protocol currently available on the market. Not only is Zcash encryption technology all-encompassing and sound, it is optional via a shielded address’s viewing key, which can potentially allow regulators access into otherwise shielded transactions. This “opt-out” functionality will be a huge factor to adoption of Zcash shielded addresses in heavily-regulated financial markets like New York. The use of shielded addresses will further increase Zcash fungibility, further enhancing its utility as a store-of-value.
Though 10% of Zcash issuance will be paid as a Founders Reward to the Zero Coin Electric Coin Company and other early investors in the technology, the project has continued to decentralize with the formation and financing of the Zcash Foundation. The separation of project governance from Founder influence will be crucial for the project going forward.
The recent Sapling release included new proof constructions which drastically reduce both the computing requirements and run time of creating shielded transactions. This allows light-users such as exchanges and mobile wallets to utilize shielded z-addresses for the first time.
Via rigorous analysis of the mathematical proofs support zk-snarks, C2C has identified Zcash as the premier ‘privacy’ coin and deflationary store-of-value protocol currently available on the market. Not only is Zcash encryption technology all-encompassing and sound, it is optional via a shielded address’s viewing key, which can potentially allow regulators access into otherwise shielded transactions. This “opt-out” functionality will be a huge factor to adoption of Zcash shielded addresses in heavily-regulated financial markets like New York. The use of shielded addresses will further increase Zcash fungibility, further enhancing its utility as a store-of-value.
Though 10% of Zcash issuance will be paid as a Founders Reward to the Zero Coin Electric Coin Company and other early investors in the technology, the project has continued to decentralize with the formation and financing of the Zcash Foundation. The separation of project governance from Founder influence will be crucial for the project going forward.
The recent Sapling release included new proof constructions which drastically reduce both the computing requirements and run time of creating shielded transactions. This allows light-users such as exchanges and mobile wallets to utilize shielded z-addresses for the first time.