Zcash Mining | What You Need to Know

Zcash is a privacy-centric cryptocurrency that uses zero-knowledge proofs to keep the transaction information of its users 100% private, thus creating a truly anonymous cryptocurrency, instead of a coin with a built-in mixer service. As one of the few relevant cryptocurrencies that is to be launched without an Initial Coin Offering period, Zcash mining is something that is extremely appealing to users, especially since the technology is extremely promising and it has some of the most influential groups in the blockchain industry backing it. Demand for Zcash will probably be high, and mining will be the only way to get it.

Zcash will use the Equihash hashing algorithm, which is an asymmetric memory-hard PoW algorithm based on the generalized birthday problem. It relies on high RAM requirements to bottleneck the generation of proofs and making ASIC development unfeasible and miner optimization harder.

Zcash will follow the same issuance rate as Bitcoin, with 21million ZEC being issued over the course of 131 years, but instead of 10-minute blocks with an initial 50 ZEC block reward, Zcash will have 2.5 minute block times with an initial 12.5 ZEC block reward and the halving will occur every 4 years. Since no ICO will be hosted, the Zcash team and its initial investors will be entitled to keep 10% of the total ZEC supply. This will be achieved through an allocated block reward called “Founders Reward”, meaning that during the first 4 years, 20% of the block rewards will be distributed to the stakeholders in the Zcash Company — founders, investors, employees, and advisors.

Zcash is set to be launched on the 28th of October, with its initial release date being delayed 1 month for auditing purposes. Zcash will be launched with a standard CPU miner, but a crowdfunding campaign is taking place on the forum to fund the development of a GPU miner. Not much has been decided and due to Zcash’s new algorithm, the performance improvements over CPU mining are going to be relatively small.

In order to provide a fair launch and to avoid issues related to “instamines” such as faster blocktimes, Zcash will launch with a slow mining period, in which the block reward will be smaller than the preset 12.5 and will slowly increase to reach the normal issuance rate.

If any of our readers are interested in mining Zcash with their CPU, they can follow this guide and mine on the testnet, which is currently in Beta stage. When mining on the real blockchain, all one would need to do is to remove the “testnet=1” line from the configuration file. Zcash is not available for Windows and will not be on launch, although the team plans to include it on the second release. Be advised that Zcash (TAZ) testnet holds no real value and that the testnet is bound to be reset, resetting your TAZ balance.

Buying Zcash will be hard in the beginning, as exchanges will only add it once a fair amount of volume has been mined, so you may want to give mining a try!