Should I Buy Zcash?
Table of Contents
Cryptocurrencies have, more or less, hit the mainstream now. They embody the future of money that is digital, decentralised and private. Privacy, or rather anonymity, was a major appeal for cryptocurrencies ever since Bitcoin (the first ever crypto) was launched in 2008.
Initially, in the early years, cryptocurrencies were associated with the dark web, essentially the digital black market. But as time has gone by, people have found out that the idea that transactions cannot be traced back to them, is largely a myth. Blockchain is the underlying technology behind cryptocurrencies, which operates fundamentally as a public ledger of transactions. This makes Bitcoin one of the most open and transparent financial systems in the world. Transparency promotes integrity, but with transactions able to be tracked back to individuals, it means there is no privacy.
This was the major flaw of Bitcoin, but ironically, a major factor that led to its prominence. Still, Bitcoin’s rise from being worth a few cents to the dollar to a high of circa $20,000 in less than ten years, demonstrated to investors that cryptocurrencies can never be overlooked. Since then, second and third generation altcoins (alternative coins) have emerged to improve upon the flaws of the first major crypto coin and to stake a claim as the coin of the future.
One of these is Zcash.
Only launched in 2016, Zcash is a third-generation cryptocurrency that was developed to guarantee total privacy of transactions. When it was introduced, Zcash predictably gained traction in the crypto world and quickly rose to become one of the top 20 cryptocurrencies in the world, both in market capitalization and usage.
Here is all you need to know about the most promising coin in 2020.
Why You Should Buy Zcash?
All cryptocurrency investors track major altcoins as they seek to unearth a coin or token that will deliver Bitcoin-like returns.
Below is the case for Zcash and why you should buy this cryptocurrency:
Zcash uses zero-knowledge cryptography technology that guarantees privacy of transactions and complete identity protection. Like Bitcoin, Zcash is also powered by the blockchain technology, with transactions posted on the public ledger.
However, the zero-knowledge technology allows verifications of transactions without disclosure of the transaction amount as well as sender and receiver details. That said, Zcash also allows users the right of selective disclosure. Users can choose to share some of their transaction details for compliance, regulatory or audit purposes.
By virtue of being private and anonymous, Zcash is also fungible and completely interchangeable. A unit or block of Zcash can be exchanged for another of equal value.
When you receive a Zcash coins, they are as good as new, with no history linked to them whatsoever.
Application Specific Integrated Circuits (ASIC) grew in popularity as cryptocurrency mining demands escalated. Cryptocurrency mining is energy intensive and demands specialised devices. ASIC-enabled computation enabled this, but their high cost ensured that mining of first-generation cryptocurrencies was controlled by a limited number of individuals who could absorb the associated costs.
Zcash was specifically designed to be energy efficient, making the crypto coin ASIC-resistant. The result is that Zcash mining has literally become more ‘democratic’, promoting the conviction that cryptocurrency is money for the people, by the people.
Zcash has a shorter block time of 2.5 minutes compared to Bitcoin’s 10 minutes. This enables faster transactions and allows for higher scalability.
Faster transactions also make Zcash a more suitable cryptocurrency to serve as a global payment system.
Like Bitcoin, there will only ever be a maximum of 21 million Zcash coins.
By simply following the law of economics, the limited supply more or less guarantees that long term demand of the coin will drive its value higher.
Is it the Right Time to Buy Zcash Today?
Zcash has solid long-term fundamentals, but investors have different investment and trading goals. Some may want to wait for long term returns, but others may want to buy the coin today for short to medium term gains.
All in all, here is why Zcash is a good buy today:
Bitcoin is Trending Higher
Newer crypto coins or tokens may well take over in the future, but Bitcoin is currently king and provides the cue for the entire cryptocurrency market. In 2019, Bitcoin has trended higher, while altcoins, such as Zcash, have largely maintained a sideways trajectory. This means that there is room for the altcoins to follow the lead of Bitcoin. Going forward, there is a Bitcoin halvening happening in 2020 that is expected to limit the supply of the foremost cryptocurrency and consequently spur demand. If Bitcoin jumps higher, Zcash will overrun the move and deliver even much bigger returns.
Zcash once had an even higher value than Bitcoin but has now tumbled to much lower values. This offers investors a rare opportunity to pick up a fundamentally strong crypto coin that is capable of even surpassing the value of the foremost cryptocurrency.
In every sense, there may never be a better price to pick up Zcash.
Strong Public Face
In the altcoins world, it is easy to literally get stuck with a coin that you cannot liquidate. This is not the case with Zcash; which, although promoting privacy and anonymity, has managed to maintain a strong public face. Zcash is also part of top 20 cryptocurrencies, which means that if you buy the coin, you will be able to cash out any time you wish.
Zcash is fork of Bitcoin and has similar aspirations to become the mainstream digital payment service. Notably, Zcash has better security and privacy features as well as boasts a faster transaction rate. If Zcash manages to gain global domination, or even a fraction of it, its value will no doubt skyrocket.
What is zk-SNARK?
Zcash was the first cryptocurrency to implement Zk-SNARK (Zero-Knowledge Succinct Non-Interactive Argument of Knowledge) to protect its transactions. Zk-SNARK is a new form of cryptographic algorithm that provides a proof of information without revealing the exact content of the information. This is very important because both companies and individuals have certain information that they desire to keep private and confidential. Zk-SNARK enables this on blockchain. On the public ledger, there is a ‘prover’ who must assure the ‘verifier’ that a transaction is complete without revealing any further details. To understand how this works, consider this case: an individual can seek to prove that there is money in his/her bank account without revealing the amount. Summarily, a zk-SNARK protocol only ensures that an interaction is true, and no further details are sought.
Financial transactions are generally private, but zk-SNARK can be applied on blockchain to promote privacy in different, other fields. The world is becoming more digitally integrated, with numerous data being collected by companies at literally every turn. This makes the case for using zk-SNARK to protect user identities and all types of private information, more prominent.
Zcash was launched in 2016 by a competent and reputable team. The team, labelled as the Electric Coin Company, is made up of cryptographers, scientists, educators, activists and policy experts who leverage their knowledge and expertise to develop one of the most improved and popular forks of Bitcoin. The Zcash protocol was the result of thorough research that incorporated teams from major universities, such as John Hopkins, MIT, UC Berkeley, Tel Aviv and Technion.
Aside from the development team, Zcash has also attracted growing communities of users, enthusiasts and fanatics. Zcash Foundation also sponsors multiple forums and chats that accept volunteers, willing to participate in Zcash programmes. Such communities are able build, preserve and share knowledge, ideas and all manners of proposals that will continually help to ensure Zcash realises its goal of creating an open, inclusive financial system.
Is Buying Zcash Safe and Legal?
Like other cryptocurrencies, Zcash exists as decentralised digital money that supports peer-to-peer transactions. Cryptocurrencies are also apolitical and borderless, which essentially means that they do not fall under the regulatory jurisdiction of any single government. Cryptocurrencies have emerged as a product of technology, specifically blockchain. The revolutionary technology has the potential of creating a more open and transparent society.
Its impact in the financial world is clear and every sector has tried to integrate the technology. The fact is that the technology is not illegal in any manner, which makes cryptocurrencies more or less in the legal grey area. The problem is that governments originally viewed cryptocurrencies as a threat to their central bank-backed fiats. But while governments stand to lose control over their monetary policy, they stand to gain overall by adopting cryptocurrencies. Cryptocurrencies are well placed to solve issues such as tax evasion, runaway inflation and treasury mismanagement.
Advanced countries, such as Japan and Iceland, have realised this and are taking proactive steps to promote adoption. Even less developed countries, such as Venezuela and Argentina, have concrete plans to adopt cryptocurrencies so as to control inflation. When cryptocurrencies first emerged, most governments issued blanket bans, but the sentiment now has shifted more towards regulation. Zcash developers realised this, and while privacy was the focus, the feature of selective disclosure ensures that users are able to meet regulatory obligations even in tight jurisdictions. This ultimately means that Zcash can be considered as money that is legal and can be used to buy, sell, send, and receive as well as a store of value.
Cryptocurrencies are digital cash, and as such, a major risk factor has always been susceptibility to hacking. But safety and security were the major motivation factors for the development of Zcash. While the possibility of hacking Zcash cannot be ruled out, it would require massive computational power to bypass zk-SNARK verification systems. Currently, Zcash is one of the most secure cryptocurrencies in the world. Still, crypto exchanges that allow buying and selling of Zcash can also be vulnerable to hack activities. This is why investors must ensure they deal with solid and reputable crypto exchanges that apply the highest level of security measures.
However, investors can still take advantage of the price movement of Zcash without worrying about the safety of the coins themselves. Zcash CFDs allow this, as investors can trade the price movement of Zcash without owning the underlying coins. With Zcash CFDs, no coin is at risk and CFD brokers are some of the most secure financial institutions because of the high level of regulation in that sector.
Is There a Difference Between Buying and Trading Zcash?
Zcash is by all means a lucrative cryptocurrency. But the question every investor always asks is whether they should buy Zcash coins, or just trade them.
Here is the difference between the two investing models:
Ownership and Safety
When you wish to own Zcash coins, you will mostly buy through a crypto exchange; whereas when you wish to trade Zcash, you will do so through a CFD brokerage company. When you buy Zcash you will actually own the coins and you will require either an online or offline wallet to store them. After buying Zcash coins, their safety will depend on a lot of factors. You will have to keep the private keys to your wallet very safe to start with and also store your offline wallet safely. However, if you have an online wallet, you will hope that your exchange is not a victim of hacking.
If you trade Zcash on a CFD broker, you will not own the coins; you will only be speculating on their price movement. This automatically means that you will not be worried about losing any coins. CFD brokers are required to meet stringent safety and security measures as part of their regulatory compliance procedures. You will never lose any Zcash coins, but your capital and profits trading the crypto coin will also always be safe.
A major appeal of CFD trading, leverage enables investors to control huge trade positions in the market. CFD brokers offer leverage levels of up to 1000:1, which essentially means that you can trade a $100,000 Zcash position by only placing a margin capital of $,1000. Even a tiny movement in your favour will result to massive profits compared to the stake amount. This is not the case with buying Zcash coins, because a capital of $1,000 will only purchase coins worth the same value. But while leverage boosts profits and helps preserve capital, it can also result in massive losses if prices go against your prediction.
Liquidity is an important factor to consider when investing, even more so with cryptocurrencies. A liquid asset is easily convertible into cash or any other convenient method an investor wishes. As well, investors can buy and sell liquid assets at fair prices at all times. As inherently volatile assets, when you own Zcash coins and wish to liquidate them at an exchange, it may take more time and you may not cash out at the intended price. This is also because you will require an actual buyer when you decide to sell your coins. This is not the case when you trade Zcash CFDs. You will be able to enter or exit trade positions instantly at your desired price levels.
Whether you decide to buy or trade Zcash, you will require a trading platform to make sound entry and exit decisions. Cryptocurrencies are a new asset, and crypto exchanges have only existed for a short time. As such, their platforms are as basic as can be, with most of them only offering buy or sell functionalities and rudimentary charting capabilities.
On the other hand, CFD brokers have existed for many years now and their trading platforms are more robust and advanced. A standard CFD broker’s platform will feature multiple order types, advanced charting, numerous trading tools and resources, as well as integrated automated trading. A trading platform is your pathway to the world of financial assets trading, and CFD brokers ensure it is as wide and smooth as possible.
When you buy Zcash, profits can only be made if the value of the coins increases. Since its introduction, the price of Zcash has largely trended lower to sideways. While this will most probably change going forward, early coin owners have had to grapple with long term losses. In contrast, when you trade Zcash CFDs, profits can be made whether prices are rising or falling. When prices are rising, you will make money if you buy Zcash CFDs; and when prices are falling, you will make money when you sell Zcash CFDs.
The Best Place to Buy Zcash
As discussed above, the best model of investing in Zcash is by trading CFDs. The parameters discussed above will help pick out the best CFD brokers to trade Zcash. Find below the best brokers to trade with as well as the pros and cons of trading Zcash CFDs.
Pros of Buying Zcash
In the CFD market, volatility is an investor’s friend. Money is made out of price movement. Zcash is a very volatile asset and it offers investors numerous lucrative trading opportunities round the clock.
Zcash is one of the top 20 cryptocurrencies in the world, which makes it a very liquid asset. This essentially means that Zcash can be traded with transparent price feeds at CFD brokerage platforms at all times.
Easy To Access
As one of the most popular and promising cryptocurrencies, Zcash is available for trading in most CFD brokerages. CFD brokers are easily accessible as well, and investors will not have to bother about crypto wallets or private keys to trade their favorite cryptocurrencies.
Regulated CFD brokers guarantee investors safety and security when they are trading their favorite financial assets. The brokers also commit to maintaining high professionalism at all times as well as keeping all client data confidential.
Cons of Zcash
Since their inception, cryptocurrencies have earned the reputation of being highly volatile and unstable assets. Zcash is no different. With CFD brokers offering high leverage, price instability can lead to massive risk exposure when trading Zcash.
Cryptocurrency CFDs attract relatively higher trading fees than other asset classes, such as Forex or even Commodities. Other associated costs, such as swaps or rollovers, can also add up if an investor wishes to hold a Zcash position for much longer.
Limited Crypto Assets
Unlike crypto exchanges that offer investors a wide range of assets, CFD brokers usually only allow investors to trade a few select coins and tokens. Furthermore, some CFD brokers can place limits on the maximum volume of any particular cryptocurrency that can be traded at a time.
How to Buy Zcash Anonymously
Privacy and anonymity were very much the appeal of cryptocurrencies when they first emerged. But the distrust governments initially felt towards the space has always motivated some investors to buy cryptocurrencies, such as Zcash, anonymously. Maintaining online privacy is very important, particularly with regards to crypto holdings or investments.
The best way to buy Zcash anonymously would be through peer-to-peer crypto exchanges where investors can exchange various coins and tokens without having to reveal their identities. Other crypto exchanges may allow you to buy Zcash and other cryptocurrencies without revealing your identity, but in limited quantities. With regulatory hands gripping heavily on the industry, crypto exchanges have been obliged to perform relevant KYC (know your customer) procedures on their investors, making complete anonymity virtually impossible.
CFD brokers also have to comply with KYC and anti-money laundering guidelines imposed by regulatory agencies. But as part of their compliance, they are also mandated to apply the highest standards of security measures so that private customer information is never compromised at any given time.
Best Zcash CFD Brokers
With Zcash prices currently depressed, CFD trading represents the best option to cash in on the lucrative opportunities of the coin’s price changes. But to trade Zcash CFDs efficiently, you will need a good broker.
Here is what to consider when selecting the best CFD brokerage firms to trade Zcash CFDs:
Regulation is the first sign of a trustworthy CFD broker. Regulatory agencies place strict guidelines that must be adhered to before a CFD broker is fully licensed. A regulated broker will guarantee the safety of investor money as well as provide a transparent trading environment to trade Zcash CFDs.
Like most cryptocurrencies, Zcash is an inherently volatile asset. You will require a robust and powerful trading platform to speculate on the price changes of Zcash efficiently. A good trading platform will transmit transparent price feeds at all times and will be packed with relevant trading tools and resources to ensure you can perform comprehensive price analysis on Zcash prices whenever you desire. Additionally, a good broker will also have both desktop and mobile trading platforms.
You will be trading Zcash CFDs to make money. It is important to trade with a broker that operates an efficient banking system that will ensure you can make safe, secure, quick and convenient deposits as well as withdrawals.
Customer support is an important quality of a good broker. A customer support team that is friendly, professional and responsive will go a long way in enhancing your trading experience.
Based on the above parameters, we have selected the most reputable and reliable brokers that will provide you the best possible environment to trade Zcash CFDs as well as numerous other cryptocurrencies and financial asset classes.
Frequently Asked Questions
How to Buy Zcash UK?
UK investors can buy Zcash directly from major crypto exchanges that support fiat-crypto conversion. Another option would be peer-to-peer exchange sites that allow UK residents to exchange Zcash and other cryptocurrencies easily and conveniently among each other, using local payment methods. For Zcash CFDs, UK investors have a wide selection of reputable brokers that will allow them to buy the coins instantly.
How to Sell Zcash?
Zcash is a top 20 cryptocurrency and can easily be sold on major crypto exchanges around the world. Zcash CFDs can be sold instantly on brokers by simply closing the position manually. CFD brokers also allow investors to exit their open Zcash trade positions using order types, such as Take Profit and Stop Loss.
How to Buy Zcash Instantly?
Simply register on any of the above recommended CFD brokerage firms and you can buy Zcash as well as other cryptocurrencies instantly. The sign up process on most of the brokers can be completed in less than 5 minutes.
How to Buy Zcash with a Credit Card
Major credits cards are acceptable on all of the above recommended CFD brokerage firms. Other safe and secure payment methods, such as bank wire, debit cards and eWallets, are also acceptable.