Any fans of privacy coins and mining may well have spotted the recent massive increase in the mining difficulty of ZCash (ZEC) during April:
Chart from Bitinfocharts
The recent leap has seen ZEC’s hash rate jump from just under 3GH/s to 4GH/s (4 Billion hashes per second) during the course of the month, hitting an all-time high on the 21st.
The new high comes in the wake of a persistent increase in mining difficulty of the Privacy focused coin – which was originally created by Zooko Wilcox’s Electric Coin Company as a fork from Bitcoin in late 2016. Most of the difficulty increase has come since the introduction of the first Application Specific (ASIC) hardware to support its Equihash mining algorithm in September of 2018. The latest boost appears to be inline with Bitmain’s release of the Z11 Antminer, an update to the Z9 that first heralded its support for Equihash coins ZCash, ZenCash (ZEN) and Komodo (KMD). The new model apparently sold out its first round of stock in under half an hour, with Bitmain reporting that it began shipping the new units out around the 11th of the month.
Late 2018 saw significant upgrades made to ZCash, in the form of its ‘Sapling’ code upgrade which updated its core ZK-Snark cryptography (that stands for Zero-Knowledge Succinct Non-Interactive Argument of Knowledge, allows proof of possession without interaction between the prover and verifier and is the basis of ZCash) as well as adding additional features to the coin’s code and reducing its storage requirements. As the crypto approaches its first four-year halving of its rewards in 2020, the team behind it are intent on turning their attentions to adding more non-security features and increasing scalability – with all proposals channelled through the ZCash Improvement Proposal (ZIP) process, in a collaboration between the Electric Coin Company and the ZCash foundation.
Interestingly, vying for a place among these plans is the limiting of ASIC mining effectiveness. When the Antminer Z9 was initially mooted, debate immediately sparked up among the naturally skeptical community about how any centralisation of mining resources could cause trouble for a privacy focused coin like ZCash. It is a debate that appears to be rumbling on… As early as May 2018, the ZCash foundation announced plans to develop ASIC resistance and undertake further research – though outright stated that Wilcox himself was “ambivalent” about the matter. When, in late June of last year the community voted down plans to add ASIC resistance to the coin at that time, the independent ZCash foundation moved to fund research into a Programmatic Proof of Work (ProgPOW) ASIC-resistant feature set that could potentially be added to the coin’s code at a later date.
For its part, in a September 2018 blog on the ZCash website ECC itself added that: “Our ultimate objective is broad inclusion. We want to support hobbyists and professionals. We want to support the people who are invested and committed to the long-term success of Zcash as well as people who simply transact.”
It also added: “If we are to keep Zcash open, accessible, and valuable to all kinds of people and groups, all around the world, a response must be thoughtful and well-reasoned, and this will take time.”
Thus, as is the case with the debate around ASIC resistance and Ethereum, ZCash rejection of large scale mining is far from certain or close. However, at the moment, the constant rise in mining interest backing up a crypto that sees itself as becoming vital as fungible cash-like medium of exchange within the next decade, proves that it remains attractive to all miners for now.